In my view, merely because affidavit in rejoinder is not filed by the
Judgment Creditor to the affidavits filed by the Judgment Debtor, this court
cannot come to the conclusion that what is stated in the affidavit filed in
response to the order passed by this court, under Order 21 Rule 41, is
deemed to have been proved and no further enquiry about the correctness
thereof would be necessary. Punjab & Haryana High Court in the case of M/s.
Baru Ram Banarsi Dass (supra) has considered similar situation and has held
that the purpose of order 21 rule 41 of the Code of Civil Procedure is to
ascertain property if any owned by the Judgment Debtor so that the same may
be sold for recovery of the decretal amount. It is held that no prejudice
would be caused to the Judgment Debtor if he is cross examined provided he
has nothing to conceal from the court and if the Judgment debtor actually
does not have any property, he should have nothing to fear from his cross
examination. Punjab & Haryana High Court has held that the examination
within the purview of Order 21 Rule 41 of the Code of Civil Procedure,
includes cross examination because the purpose is to ascertain whether the Judgment Debtor has any property so that the money decree can be
satisfied. It is held that if cross examination is not permitted the Judgment
Debtor may falsely state that he does not own any property and if the
Judgment Debtor is cross examined, there would be nothing illegal therein. I
am in agreement with the views expressed by the Punjab and Haryana High
Court. In my view, the principle laid down by the Punjab & Haryana High
Court in the case of M/s. Baru Ram Banarsi Dass (supra) are applicable to
extended to this case.
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
CHAMBER SUMMONS NO. 1170 OF 2009
IN
EXECUTION APPLICATION (L) NO. 463 OF 2009
IN
AWARD NO. 8 OF 2004
M/s. LA'Builde Associates Vs Bipinchandra Narandas Dalal
CORAM : R.D. DHANUKA, J.
PRONOUNCED ON : 6TH SEPTEMBER, 2013
Citation;2013(6)ABR406, 2013(6)ALLMR497
By this Chamber Summons, the applicants (judgment creditors)
seeks directions against Mr.Anil Shantilal Parekh, guardian and Manager of
the respondent appointed by this court to disclose on oath by filing an
affidavit as to whether any debts are owing to the respondent and whether
respondent had right, title and/or interest on 22 nd April, 2004 or on that date
any other property and/or means for satisfying the dues under the award
dated 22nd April, 2004 passed by Shri. S.R.Shah, sole arbitrator including the
respondent's assets, moveables and immoveable properties, bank accounts,
jewellary, shares, securities, other investments, present source of income,
details of the respondent's business/employment and other profitable/gainful
activities carried out by the respondent and also to disclose all other details
required to be disclosed by Form No. 16A of Appendix “E” to the Code of Civil
Procedure, 1908 to facilitate the execution of the award dated 22 nd April,
2004 by the applicant. Applicants also seek a direction against said Mr.Anil
Shantilal Parekh to produce before this court and furnish to the applicants
true copies of all the books of account, statement, income tax returns for last
ten years of the respondent to enable the applicants to use those information
for executing the award dated 22nd April, 2004 and also seek an order of
months or for such period this court deem fit.
arrest and detention of Mr.Anil Shantilal Parekh in civil prison for three
2. Some of the relevant facts are as under :
(a)
By an agreement was executed between the applicants
and the respondent on 15th May, 1981, the respondent agreed to
sell to the applicants piece of land with tenant thereon situated at
Village Anik Chamber, Mumbai described in paragraph (4) of the
affidavit in support. Applicants paid Rs.3,20,000/ to the
respondent as and by way of earnest money. Dispute arose
between the parties and was referred to arbitration.
(b)
By an order dated 13th February, 1987 in Lunacy
Petition No. 4 of 1986, this court appointed Mr.Anil Shantilal
Parekh as guardian and Manager of the person and property of the
respondent. On 22nd April, 2004, Shri. S.R. Shah, Former Judge of
City Civil Court, Bombay who was appointed as sole arbitrator
made an award holding that the applicants could not be granted
claim for the specific performance but in lieu of specific
performance directed the respondent to pay to the applicants a sum
of Rs.2,50,00,000/ as damages with interest at the rate of 6% per
annum on the said amount from the date of award till payment.
Arbitration petition filed under section 34 of the
Arbitration and Conciliation Act, 1996 by the respondent for setting
aside the said award came to be rejected. It is the case of the
applicants that the application for restoration of the said petition is
pending, however, there is no stay of execution of the award.
Respondent filed a Miscellaneous Petition (2 of 1997) in this court
which was disposed of by the consent order dated 3 rd October, 1997
whereby the said property which was agreed to be sold to the
applicants by the respondent was directed to be sold to one Origin
Builders for Rs.80,00,000/ subject to the applicants' right.
(d)
On 17th July, 2009, the applicants filed this Chamber
Summons for various reliefs. On 8 th February, 2011, applicants
moved an application for leave to execute decree. By an order
passed by this court, notice filed under Order 21 Rule 22 is made
absolute after hearing the respondent. Respondent did not file any
appeal against the said order. By an order dated 6 th May, 2011,
respondent undertook to file his reply to the Chamber Summons
within two weeks from the date of the said order. This Court
granted adinterim reliefs in terms of prayer clauses (a) and (b) of
the said Chamber Summons. Prayers (a) and (b) of the Chamber
Summons are extracted as under :
“(a) That this Hon'ble Court be pleased to direct Shri.
Anil Shantilal Parekh, the guardian and Manager of the
ig
Respondent, appointed under the Order of the High Court
at Bombay in Lunacy Petition No. 4 of 1986 to file in this
Hon'ble Court within 2 weeks of such Order an Affidavit
and furnish to the Applicants copy thereof, within the said
period, stating on oath as to whether any debts are owing
to the Respondent and whether the Respondent had
right, title and/or interest as on date of the Order dated
22nd April, 2004 or has as on the date any other property
and/or means for satisfying the dues under the Award
dated 22nd April, 2004 passed by Shri. S.R. Shah, Sole
Arbitrator including the Respondent's assets, movable and
immovable properties, Bank Accounts, Jewellery, Shares,
Securities, other investments, present source of income,
details of the Respondent's business/employment and
other profitable/gainful activities being carried on by the
Respondent and thereby to disclose all other details
required to be disclosed by Form No. 16A of Appendix “E”
to the Civil Procedure Code, 1908 to facilitate the
execution of the said Award dated 22 nd April, 2004 by the
Applicants.
(b) That the said Shri. Anil Shantilal Parekh, the
guardian and Manger of the Respondent, appointed under
the Order of the High Court at Bombay in Lunacy Petition
No. 4 of 1986 be ordered and directed to produce before
this Hon'ble Court and furnish to the Applicants within 2
weeks of the Order or such time as may be prescribed by
this Hon'ble Court, true copies of all the Books of
Account, statement, Income tax returns for last ten years
of the Respondent to enable the Applicants to sue those
information for executing the said Award dated 22 nd April,
2004.”
(e)
On 17th May, 2011 Mr.Anil Shantilal Parekh, guardian
and Manager of the respondent filed an affidavit in this Chamber
Summons. It is stated in the affidavit that he has sold the
properties of the respondent after obtaining sanction of this court
and part of the sale proceeds was utilised for buying the flat which
was purchased in the name of the respondent and his daughter and
rest of the amount was kept in fixed deposit of bank as per order
passed by this court on 3rd August, 1997. It is stated in the affidavit
that by an order dated 1st August, 2003 passed in Miscellaneous
Petition No. 29 of 2003 in Lunacy Petition No. 4 of 1986, this court
granted leave to the said Mr. Anil Shantilal Parekh to withdraw
from the fixed deposit, amount spent by him from time to time
which included household expenses, expenses for hospital and
medicines, security expenses etc. In paragraph 21 of the said
affidavit, it is stated that debts of the respondent is at Rs.2,50,000/
payable as a legal expenses and professional fees to the advocates,
solicitors and Chartered Accountants as on 31 st March, 2011. In
paragraph 22, it is stated that as on 31 st March, 2011, the
respondent is not having any property. In paragraph 23, it is stated
that the balance in the bank account of the said respondent with
Jammu and Kashmir Bank Ltd., Kalbadevi Branch, Mumbai – 400
002 is at Rs.414/ on the date of filing that affidavit. In paragraphs
24 and 25, it is stated that as on 31 st March, 2011, respondent did
not have any moveable properties and respondent had Rs.38,087/.
In paragraph (26), it is stated that respondent does not have any
immoveable properties. Since there is no taxable income liable
under Income Tax Act, 1961, income tax returns have not been
filed with the Income Tax Authorities. Alongwith the said affidavit,
balance sheet from the period from 1 st April, 2003 to 31st March,
2011 have been annexed. In paragraph 29 of the said affidavit, it is
stated that the flat No. 2B at Vaibhav, 140, S.V.Road, Irla, Mumbai
– 400 056 was owned by the wife of lunatic and she had already
disposed of the said flat.
(f)
On 20th June, 2011, the said Mr.Anil Shantilal Parekh
filed additional affidavit stating that the respondent who is lunatic
is not involved in any employment, trade or profession and does
not have any annual, monthly or weekly income. Respondent does
not own any house or other immoveable property. Respondent
owned a residential house at 405, RNA Heights, Jogeshwari –
Vikhroli Link Road, Jogeshwari (E), Mumbai – 400 093 which was
sold at the market price by registered agreement to Mr.Krishnanand
Shaker Marvinkurve in the year 2005 for maintaining and up
keeping the respondent. Copy of the said agreement dated 17 th
November, 2005 has been annexed. It is stated in the additional
affidavit that as on the date of filing of the said affidavit,
respondent had Rs.414/ in his bank account No. 2010 with Jammu
and Kashmir Bank Ltd., Kalbadevi Branch, Mumbai – 400 002. He
did not have any stock and shares, life and endowment policies,
house property, other property and other securities. It is stated that
there are no debts due to the respondent. It is stated that some of
the properties were already sold by the respondent even prior to
the declaration of the arbitration award. It is stated that
professional fees of Rs.2,50,000/ could not be paid to the
chartered accountant and the advocate as there was no fund
available in the account of the respondent. It is stated that memo
of Arvind Rathod & CO. was for Rs.3,67,000/ out of which
Rs.2,25,000/ is still pending. In the said affidavit Mr.Anil S.
Parekh also annexed statement of accounts for the period from 1 st
April, 2004 till 31st March, 2011. The applicants did not file any
rejoinder to both these affidavits.
The Applicants filed contempt Petition (71 of 2011) in
(g)
this court against respondent and Mr. Anil Parekh for not
complying with the order passed by this court on 17 th November,
2011. By an order dated 6th May, 2011 passed by S.C.
Dharmadhikari,J. this court observed that it was apparent from the
affidavits and also from the contempt petition itself that the
ig
compliance was made on 17th May, 2011. It is however, observed
that the petitioners in the said contempt petition made allegations
that the said affidavit which was filed on 17/5/2011 in compliance
with order dated 6/5/2011 was absolutely vague and devoid of
any particulars or or contains misleading facts or false statements
were made therein, however, the same was not the matter which
could be decided in contempt petition. This court accordingly
dismissed the said contempt petition with such observations.
3. SUBMISSIONS OF MR. K.P. JAIN, COUNSEL FOR THE
APPLICANTS :
(a)
Mr. Kishore Jain, learned counsel for the applicants
submits that all questions arising between the parties to the suit
in which decree was passed or their representatives and relatives
to the execution be discharged or satisfaction of the decree has to
be determined by the Executing Court. It is submitted that the
provisions under Order 21 of the Code of Civil Procedure is not
substantive law but is a procedural in nature and gives
guidelines to the courts to do justice. It is submitted that in view of
the ex facie contradictions in the affidavits filed by the Judgment
Debtor and in view of the Judgment Debtor not complying with ad
interim order passed by this court on 6/5/2011, in terms of prayer
clauses (a) and (b), by disclosing various documents, non filing of
the rejoinder by the applicant to those two affidavits filed by the
Judgment debtor would not be of any consequence. He submits
that these two affidavits contain various false and incorrect
averments and discloses contradictions on the face of it and thus
does not deserve any credence. Mr. Jain submits that the court is
entitled to look into as to whether the averments made in the
affidavit filed pursuant to the order passed under Order 21 rule 41
are true or not. The court can even suo moto decide that such
affidavits are on the face of it false and contradictory. Mr.Jain
submit that though this court had directed the Judgment Debtor to
produce various documents described in prayer clauses (a) and (b)
of the Chamber summons, no such documents have been
produced by the Judgment Debtor. The Judgment Debtor also did
not produce any records directed to be produced by the ad
interim order dated 6/5/2011. Mr. Jain submits that the purpose
of granting prayer clauses (a) and (b) in favour of the applicant
was to find out the assets of the Judgment Debtor to enable the
applicants to execute the decree passed in its favour. Two weeks
period was granted to the Judgment Debtor to comply with the
said directions. This Court did not extend the time to comply with
the said ad interim order. The Judgment Debtor did not comply
with the said ad interim order dated 6/5/2011. In so far as
dismissal of the contempt petition filed by the applicant by this
court is concerned, Mr. Jain submits that the question as to
whether there are any misleading or false statement made in the
said affidavit or not are not decided in the said contempt petition
dismissed on 27th April, 2012. It is submitted that though this
court has dismissed the contempt petition, the allegations made in
those two affidavits which are ex facie false and misleading and
contradictory cannot be ignored by this court while deciding the
issue under Order 21 rule 41. The question that arises in this
proceedings are whether the Judgment Debtor has fully disclosed
all the assets and properties of the judgment Debtor with details,
particulars or not. Mr. Jain submits that merely because affidavits
are filed by the Judgment Debtor pursuant to the order passed by
this court, such affidavits cannot be accepted at its face value.
Mr. Jain submits that though the contempt petition is dismissed by
this court, this court can still see whether the records as directed
by this court are produced by the Judgment Debtor or not. It is
submitted that in these circumstances, the applicants did not file
rejoinder. It is submitted that since the documents as directed by
this court are not produced by the respondent, Judgment Creditor
could not verify the authenticity of the statements made in the
affidavit.
(b) That the intent of legislation under Order 21 rule 41 is to
find out assets and properties of the Judgment Debtor to enable
the Judgment Creditor to take steps to sell the said properties for
recovery of the decretal amount and for ascertaining the
correctness of such statements made in the affidavits and the
documents produced, if any, cross examination of such witness
would be must. It is submitted that oral examination permitted
under Order 21 rule 41, would be meaningful only by granting
opportunity to the Judgment Creditor to cross examine such
witnesses. Mr. Jain submits that to prevent any miscarriage of
justice, the court has power to undertake exercise of enquiry
to find out the assets so that the process of execution would
Mr. Jain invited my attention to annextures to the
(c)
come to its logical end.
affidavit dated 17/5/2011 filed by the Judgment Debtor through
Mr. Anil Parekh. It is submitted that Mr. Anil Parekh who has been
appointed as Manager and Guardian of the Lunatic is completely
in charge of the assets and properties of the respondent. Mr. Jain
pointed out from the statement annexed to the affidavit that
there is inconsistency in the affidavit. On one hand it is stated
that the respondent Judgment Debtor has no property and on the
other hand it is disclosed that he has sum of Rs.38,087/ with him.
The Judgment Creditor pointed out that the large amount of
interest is claimed to have been paid to Mr. Anil Parekh by the
respondent which are adjusted and recovered by him from the
amounts of the respondent lying with him. Deponent of those two
affidavits have recovered large amount of interest without
disclosing as to why such interest was paid to him and/or
recovered from respondent. It is submitted that Mr. Anil Parekh
has wiped of the entire assets by producing such fabricated
statement of accounts. Flat worth Rs.66 lacs which was owned by
the respondent also has been sold by the said Mr. Anil Parekh.
(d)
Mr. Jain placed reliance on the judgment of Punjab
and Haryana High Court delivered on 30 th March, 2010 in
Civil Revision No. 2000 of 2010 in support of his submission that
the court has power under Order 21 Rule 41 of the Code of Civil
Procedure to ascertain that the property if any owned by the
Judgment Debtors so that the same may be sold for recovery of the
decretal amount and cross examination of such witnesses can be
permitted. The relevant paragraphs of the said judgment read
thus :
“Decree holder filed application under Order 21, Rule 41 of
the Code of Civil Procedure ( in short "CPC") requiring the
petitionerJudgment Debtor to state about his properties.
The petitioner furnished affidavit Annexure P1 affirming
that the property owned by them as well as the firm had
already been auctioned and now, neither the firm nor the
partners individually had any moveable or immovable
property. Statement of the petitioner's partner Satpal was
recorded to the same effect. Decree Holder was permitted
to crossexamine the Judgment Debtor who admitted that
he had been filing income tax returns. His further cross
examination was deferred with direction to him to produce
income tax returns for the last two years. This order is
under challenge in the instant revision petition.
I have heard learned counsel for the petitioner
and perused the case file.
Learned counsel for the petitioner vehemently
contended that Order 21, Rule 41 of the CPC provides for
examination of the Judgment Debtor to ascertain his
properties but does not provide for crossexamination of
the Judgment Debtor for this purpose. Analogy was sought
to be drawn from the provision of Order 10, Rule 2 of the
CPC. The contention cannot be accepted. Purpose of Order
10, Rule 2 of the CPC is to record statement of either party
to clarify the pleadings of the parties to elucidate the
matter in controversy. However purpose of Order 21, Rule
41 of the CPC is to ascertain the property if any owned by
the Judgment Debtor so that the same may be sold for
recovery of the decretal amount. It is not explained how
Judgment Debtor/petitioner would be prejudiced if he is
crossexamined provided he has nothing to conceal from
the Court. If the petitioner actually has no property, he
should have nothing to fear from his crossexamination. On
the other hand, examination within the purview of Order
21, Rule 41 of the CPC, includes crossexamination because
the purpose is to ascertain whether the Judgment Debtor
has any property so that the money decree may be satisfied.
For the said purpose, if the Judgment Debtor is cross
examined, there would be nothing illegal in it. On the other
hand, if crossexamination is not permitted, the Judgment
Debtor may falsely state that he does not own any
property.”
(e)
Mr. Jain distinguished the judgment of the Supreme
Court in the case of Municipal Corporation of Greater Bombay
relied upon by Mr. Merchant, learned senior counsel appearing
for the Judgment Debtor on the ground that the Supreme Court
did not consider the issue under Order 21 rule 41 of the Code of
Civil Procedure in that matter and the issue raised by the parties in
this proceedings was not issue before the Supreme Court in that
ig
matter.
4. SUBMISSIONS OF MR. MERCHANT, LEARNED SENIOR COUNSEL
ON BEHALF OF RESPONDENT :
(a) That the authenticity of the affidavit filed by respondent
through his guardian and Manager cannot be dealt with by this
court under the provisions of Order 21 Rule 41. It is submitted
that the authenticity can be dealt with in perjury proceedings.
There is limited scope of enquiry under order 21 rule 41 as to
whether the property of the Judgment Debtor is available to the
Judgment Creditor or not for execution of the decree. It is
submitted that if the Judgment Debtor finds out that the
statements in the affidavit filed by the Judgment Debtor pursuant
to the order passed by this court under Order 21 Rule 41 are false
and misleading, the Judgment Creditor can always file perjury
proceedings against the Judgment Debtor for filing such false and
misleading affidavit. The Judgment Creditor can apply for
amendment if it is found that the other properties are available
which were not disclosed by the Judgment Debtor in the said
affidavit and file perjury proceedings. The Judgment Creditor
has not exercised that remedy. Learned senior counsel then
submits that the applicant did not file any rejoinder denying the
correctness of the contents of the of the assets and properties
disclosed by the Judgment Debtor in the affidavit filed under Order
21 rule 41. The Judgment Creditor cannot cross examine the
Judgment Debtor on the contents of the said affidavit filed in
response to the order passed by this court. It is submitted that if
this court wants to ask any question to the witness to ascertain
correctness of the contents of the affidavit filed by the Judgment
Debtor, the court can do so under Order 21 rule 41 but such
witness cannot be called upon by the Judgment Creditor for cross
examination.
(b) Various modes of execution are set out in Order 21 rule 30 for
money decrees. The application for examination of the Judgment
Debtor is not one of such mode of execution. Mr. Merchant
submits that various amounts allowed to be withdrawn or the
properties of the respondents which were sold by the Guardian
and Manager appointed by this court were sold after obtaining
sanction of this court. Various amounts which were allowed to be
withdrawn were withdrawn for the purpose of maintenance and
were spent on various expenditure incurred on the respondent. It is
submitted that the question as to whether Mr. Anil Parekh who
was appointed as Guardian and Manager of the respondent had
committed any breach of the duty as guardian and Manager of the
respondent and/or has misused any funds of the lunatic cannot be
gone into by this court under Oder 21 rule 41. Such issues can be
decided only in the proceedings in which the said Mr. Anil Parikh
was appointed as Guardian and Manager of the respondent who is
lunatic.
(c)
Reliance is placed on the judgment of the Supreme
Court in the case of Municipal Corporation of Greater Bombay
Vs. Lala Pancham and Others, AIR 1965 SC 1008 and in
particular para 6 and 15 in support of his submission that the
court cannot compel a party to examine any particular witness
and it would be beyond competence of the court under Order 21
rule 41 to issue such direction to Judgment Debtor to examine
the deponent of the affidavit. Paragraph 6 and 15 of the said
judgment reads thus :
“6. The trial court dismissed the suit mainly upon the
ground that it was not tenable. An appeal was taken by
the plaintiffs to the High Court which was dismissed
summarily by Datar J., on August 25, 1961. On the same
day the plaintiffs preferred an appeal under the letters
patent which went up before a Division Bench consisting
of Patel and Palekar JJ. The learned Judges permitted the
plaintiffs to amend the plaint overruling the objections of
the defendants. In their judgment the learned Judges
held that the suit was not barred. Then they proceeded to
consider the question of mala fides. According to them
the plaintiffs had pleaded mala fides but that they had
omitted to give particulars. They also observed that it
was true that no evidence was led by the plaintiffs before
the trial court and ordinarily they would not have been
entitled to lead fresh evidence at that stage, much less so
at the stage of the appeal under letters patent. According
to them, however, it is not possible to dispose of the case
on the material on record, that there are certain
documents on record which, if unexplained, "support in a
large measure the contention of the plaintiffs that
defendants 2, 3 and 4 obtained an order by fraud and
also that the order was mala fide." After referring to some
of these documents they observed : "Though therefore no
evidence is led on the question of mala fides or fraud
committed upon them, it prima facie leads to such an
inference, and it would not be proper to decide the
question without requiring further evidence." This
observation was followed by another which, we think, is
a very unusual one. It is this : "We particularly want the
Commissioner and the City Engineer and the defendants
to be examined on this question." Eventually, the learned
Judges remitted the case to the City Civil Court for
recording additional evidence and directed that Court to
certify the evidence and its findings by the end of
November, 1962. After the grant of special leave to the
appellants the proceedings before the City Civil Court
have been stayed.
15.
We are, therefore, of the view that the High
Court was in error in allowing the amendment to the
plaint and in remitting the suit to the trial court for a
virtual retrial. The High Court, however, did not rest
content with this order but further directed "we
particularly want the Commissioner and the City
Engineer and the defendants to be examined on this
question" the question being the breach of an assurance
given to the tenants. In making this direction the High
Court may have been actuated by a laudable motive but
we think it ought to have borne in mind the limits which
the law places upon the powers of the Court in dealing
with a case before it. Just as it is not open to a court to
compel a party to make a particular kind of pleading or
to amend his pleading so also it is beyond its competence
to virtually oblige a party to examine any particular
witness. No doubt, what the High Court has said is not in
terms a peremptory order but the parties could possibly
not take the risk of treating it otherwise. While therefore,
it is the duty of a court of law not only to do justice but
to ensure that justice is done it should bear in mind that
it must act according to law, not otherwise.”
(d)
That the Judgment Debtor has already complied with
the order passed by this court under Order 21 rule 41 by filing
two affidavits and has disclosed all the assets and properties of the
respondent. It is submitted that the applicant has not made any
application to cross examine deponents of the said two affidavits
and thus no order for cross examination of the deponent of the
said two affidavits can be passed by this court. Order 21 Rule 41
of the Code of Civil procedure is extracted as under :
“41. Examination of judgment debtor as to his property.
(1) Where a decree is for the payment of money the decree
holder may apply to the court for an Order that—
(a) the judgment debtor, or
(b) where the judgment debtor is a corporation, any officer
thereof, or
(c) any other person, be orally examined as to whether any
or what debts are owing to the judgment debtor and
whether the judgment debtor has any and what other
property or means of satisfying the decree; and the court
may make an order for the attendance and examination of
such judgment debtor, or officer or other person, and for
the production of any books or documents.
(2)
Where a decree for the payment of money has
remained unsatisfied for a period of, thirty years, the court
may, on the application of the decree holder and without
prejudice to its power under subrule (1), by order require
the judgment debtor or where the judgment debtor is a
corporation, any officer thereof, to make an affidavit stating
the particulars of the assets of the judgment debtor.
(3) In case of disobedience of any order made under sub
rule (2), the court making the order, or any court to which
the proceeding is transferred, may direct that the person
disobeying the order be detained in the civil prison for a
term not exceeding three month unless before the expiry of
such terms the court directs his release.”
On perusal of prayer clauses (a) and (b) of the ad interim order
5.
passed by this court, it is clear that Mr. Anil Parekh, Guardian and Manager of
the respondent was directed to state on oath as to whether any debts were
owing to respondent and whether he had any right, title or interest as on the
date of the order dated 22/4/2004 or has as on the date of the said order any
other property and/or means for satisfying the dues under the award dated
22nd April, 2004 including assets movable and immovable property, bank
accounts, jewellary, shares, securities, other investments, present source of
income, details of the respondent's business/employment and other
profitable/gainful activities being carried on by the respondent. Mr. Anil
Parikh was also directed to produced before this court true copies of all
books of accounts, statement, income tax returns for last ten years of the
respondent to enable the applicants to use those information for executing
the said award dated 22nd April, 2004. It is thus clear that the purpose of
granting such relief in favour of the Judgment Creditor and such direction
were issued to the Judgment Debtor and or his guardian and Manager to
produce various documents to ascertain the true and correct position of the
assets and properties of the Judgment debtor to enable the Judgment Creditor
to use those information for executing the decree passed in his favour. In
my view such direction issued under Order 21 rule 41 are not empty
formalities but are issued with specific purpose of collecting true and
correct information about the affairs and status of the properties and assets
of the Judgment Debtor which can be sold and realized for the purpose of
executing the decree obtained by the Judgment Creditor. In my view under
order 21 rule 41, not only this court is empowered to know the true and
correct details of assets and properties and debts of the Judgment Debtor
but in case of any dispute about the authenticity of the averments and
contents of the documents annexed to such affidavits and documents to
order oral examination of such deponent including cross examination. In my
view,Court is empowered to make further enquiry into the authenticity of the
averments and contents of the documents under Order 21 rule 41 and the
scope of enquiry under order 21 rule 41 is not limited as canvassed by
Mr.Merchant, learned senior counsel. If the court is satisfied prima facie that
the averments made in the disclosure affidavit does not disclose true and
correct affairs and the correct position of the assets/properties and debts of
the Judgment debtor, further enquiry into the correctness of such affidavit
and contents of documents is permissible under order 21 rule 41. In my
view Mr. Merchant, learned senior counsel appearing for the judgment
debtor is not correct in his submission that such enquiry has to be
independently made by the Judgment Creditor and if it is found that the
contents of that affidavit were false and misleading, the only remedy of the
Judgment Creditor would be to file perjury proceedings against the deponent
of such affidavit.
6.
On plain reading of Order 21 Rule 41 of the Code of Civil
Procedure, it is clear that the judgment Debtor or any other person on an
ig
application of the Decree holder may be ordered by court to be orally
examined to ascertain whether any debts are owing to the Judgment debtor
and whether said Judgment Debor has any property or means for satisfying
the decree and the court is empowered to even direct such Judgment debtor
or other person for production of any books or documents. It is clear that the
purpose of such oral examination is to ascertain the property owned by the
Judgment Debtor so that the same may be sold for recovery of decretal
amount.
7.
On perusal of the two affidavits field by Mr. Anil S. Parekh, the
Guardian and Manager of the respondent, I am of the prima facie view that
various amounts are claimed to have been recovered and/or appropriated by
the deponent of those two affidavits from the properties of the respondent
Judgment Debtor to himself towards payment of interest and other
expenditure. The deponent of those two affidavits appears to be in exclusive
control of all the assets and properties of the Judgment Debtor at least since
his appointment as Guardian and Manager of the respondent who is lunatic.
On perusal of the affidavits, it is also clear that all the documents directed to
be produced by this court by ad interim order have not been produced by the
respondent acting through as Guardian and Manager along with details.
ig
Various expenses are claimed and are alleged to have been paid by the
respondent through his Guardian and Manager and the balance if any of the
respondent is shown at negligible amount. Considering the nature of affidavit
filed by the respondent through his guardian and Manager, in my view, such
affidavit cannot be accepted at its face value and cannot be considered as
conclusive as far as debts, properties and assets of the Judgment Debtor are
concerned. In my view the Judgment Creditor is entitled to challenge such
expenditure claimed by the Judgment Debtor from the assets and properties
of the Judgment debtor. If it is found ultimately that the Judgment debtor has
filed false and misleading affidavit and has not given true and correct
position of the assets and debts of the Judgment Debtor and assets and
properties of the Judgment Debtor are available then the Judgment Creditor
would be able to recover amounts in execution of the decree in his favour. If
it is found that the Judgment Debtor has to recover any amount lying in the
hands of third party, the Judgment Creditor can always apply for attachment
of those properties and or recoverables lying with the third party by filing
garnishee proceedings.
8.
In my view, merely because affidavit in rejoinder is not filed by the
Judgment Creditor to the affidavits filed by the Judgment Debtor, this court
cannot come to the conclusion that what is stated in the affidavit filed in
response to the order passed by this court, under Order 21 Rule 41, is
deemed to have been proved and no further enquiry about the correctness
thereof would be necessary. Punjab & Haryana High Court in the case of M/s.
Baru Ram Banarsi Dass (supra) has considered similar situation and has held
that the purpose of order 21 rule 41 of the Code of Civil Procedure is to
ascertain property if any owned by the Judgment Debtor so that the same may
be sold for recovery of the decretal amount. It is held that no prejudice
would be caused to the Judgment Debtor if he is cross examined provided he
has nothing to conceal from the court and if the Judgment debtor actually
does not have any property, he should have nothing to fear from his cross
examination. Punjab & Haryana High Court has held that the examination
within the purview of Order 21 Rule 41 of the Code of Civil Procedure,
includes cross examination because the purpose is to ascertain whether the
Judgment Debtor has any property so that the money decree can be
satisfied. It is held that if cross examination is not permitted the Judgment
Debtor may falsely state that he does not own any property and if the
Judgment Debtor is cross examined, there would be nothing illegal therein. I
am in agreement with the views expressed by the Punjab and Haryana High
Court. In my view, the principle laid down by the Punjab & Haryana High
Court in the case of M/s. Baru Ram Banarsi Dass (supra) are applicable to
extended to this case.
9.
the facts of this case also and the principle laid down therein can be
In the case of Republic of Costa Rica Vs. Strousberg Vol. 16
Chancery Division Page 8, similar facts and provision which is in para materia
with Order 21 Rule 41 has been construed and similar question raised in
this proceeding was subject matter of the said proceedings. It is held that the
examination of the witness is not only intended to be an examination, but to
be a crossexamination, and that of the severest kind. It is held that all the
questions asked were fair questions in that sense, and fairly pertinent and
properly asked with a view of ascertaining from the Defendant what debts
were owing to him, and that they ought all to have been answered. It is
further held that he ought to answer all similar questions fairly directed to
that end, and that the order asked ought to have been made by the Vice
Chancellor. He must answer all questions fairly directed to ascertain from
him what amount of debts is due, from whom due, and to give all necessary
particulars to enable the Plaintiffs to recover under a garnishee order. In my
view the principles laid down in Chancery Division on construction of the
provisions, which are in para materia with Order 21 Rule 41 of the Code of
Civil Procedure are applicable to the facts of this case and can be extended
to the matter in hand. I am in agreement with the views expressed by the
Chancery Division. Relevant paragraph of the said judgment in the case of
Republic of Costa Rica read thus :
“The Republic of Costa Rica obtained judgment against Mr.
Strousberg . Rule 1 of Order XLV. of the Rules of Court, 1875 ,
is this:—“Where a judgment is for the recovery by or payment to
any person of money, the party entitled to enforce it may apply
to the Court or a Judge for an order that the judgment debtor be
orally examined as to whether any and what debts are owing to
him, before an officer of the Court, or such other person as the
Court or a Judge shall appoint; and the Court or Judge may
make an order for the examination of such judgment debtor, and
for the production of any books or documents.” It appears that
this clause is copied in substance from the 60th section of the
Common Law Procedure Act, 1854 , which enacts that, “It shall
be lawful for any creditor who has obtained a judgment in any of
the superior Courts to apply to the Court or a Judge for a rule or
order that the judgment debtor shall be orally examined as to
any and what debts are owing to him before a Master of the
Court, or such other person as the Court or Judge shall appoint;
and the Court or Judge may make such rule or order for the
examination of such judgment debtor, and for the production of
any books or documents. ...” Now, considering that that is a
power which has been in force ever since 1854, it is certainly
somewhat remarkable that no authority can be produced on
either side as to how that examination ought to be conducted,
or to what extent it can be justifiably carried. But the Plaintiffs in
this case, availing themselves of that power, have obtained an
order for the examination of the Defendant. Now the only
subject on which he was to be examined was, what debts are
owing to him. It appears that Mr. Kekewich conducted this
examination; and it does appear to me that this is a power which
is to be strictly construed. The object of this examination
evidently is for the purpose of ascertaining from the judgment
debtor what debts are owing to him, in order that the judgment
creditor may attach those debts. It is in the nature of a discovery;
and it appears to me very much like thRe discovery of
documents where a defendant is asked what documents he has,
and he sets out what documents he has: but you cannot cross
examine him upon that. You must take his statement to be
correct. Now here, where you are to crossexamine him as to
what debts are owing to him, I think you may go to this extent:
you may ask him, “What debts are owing to you?” and if he gives
you the answer you may very well say, “Does not your banker
owe you any balance?” “Is there not a Rbalance due to you on a
contract in which you are engaged?”—and he is certainly bound
to answer; but it does appear unquestionable that Mr. Kekewich
here thought himself at liberty to go beyond the mere object of
asking what debts are owing, because he asked him, “Are you
carrying on any business at the present time?” I do not think,
under the circumstances of the case, it was necessary to ask him
whether he was carrying on business at the present time. Then
he was asked, “Are any debts owing to you?” Then he was asked,
“Are you a contractor? Is any money now due to you on any
contract now completed?” He said, “I do not understand the
question. No money is now due to me under any contract except
the contract above referred to.” Then he is asked, “Have you any
contracts pending?” Then he says, “I shall answer no questions
except as to what debts are owing to me.” Then there is this,
“Are you not a contractor by profession?” Now why should he be
asked whether he is a contractor by profession? They knew
perfectly well what he was; they knew perfectly well all about
him, and all they wanted to know was what debts were owing to
him, in order that they might *11 exercise the power of issuing
an attachment against those debts. I think, therefore, the
examination was carried beyond the object authorized by the
rule, but I am also very much impressed by the opinion that Mr.
Strousberg , being advised by counsel, refused to answer
questions which, I think, he might very well have answered.
However, my construction of the Act is that they were not at
liberty to make a general examination. With every respect for
Mr. Kekewich , I think he went there rather in the spirit of a
crossexaminer than as a mere examiner as to what debts were
owing to Mr. Strousberg . The object of the rule is simply to
ascertain whether a debtor has any debts owing to him in order
that they may be attached. To that question, in my opinion, the
questions ought to have been confined. He might have been
asked, “What debts are owing to you?” And he might have said,
“ A. B. owes me so much money, and C. D. owes me so much
money.” If the examining counsel were not satisfied with that,
he might have asked, “Have you any balance at your bankers?”
and take his answer, “Yes or no.” Therefore I think the
examination went beyond its just bounds. At the same time, I
think the answers were more curt than they might have been.
Therefore, upon the whole, I cannot make any order that Mr.
Strousberg should attend to answer these general questions
which were put to him. He must attend for the purpose of
answering the simple question authorized by the rule—what
debts are owing to him—and no others. I think there has been
overzeal on the part of the Plaintiffs. I think they have been
carrying the matter a little too far, and I rather had an
inclination to dismiss their motion with costs; but on the whole,
considering all the circumstances, I think it will be better to
dismiss it without costs.
The Plaintiffs appealed from this decision. The appeal was heard
on the 4th of November.
Glasse , Q.C., Kekewich , Q.C., and H. A. Giffard , for the
Appellants:—
If the Respondent is entitled to restrict the examination to the
simple question as to whether any debts are due to him, the
order will be a nullity. We submit he is bound to answer all
questions relevant to the subjectmatter which will tend to give
the Plaintiffs the discovery they seek, otherwise what is the use
of requiring him to attend with and produce books, vouchers,
documents, and the like?
Higgins , Q.G., and Medd , for the Respondent:—
hvn
The order is a very stringent one, and must be construed strictly.
The Respondent has complied with the order made against him.
The questions put were quite irrelevant to the subjectmatter.
JESSEL, M.R.:—
I think this appeal must succeed. As I understand the rule, the
examination is to be “as to whether any and what debts are
owing to the judgment debtor.” That means exactly the same
thing as “touching the debts owing the judgment debtor,” which
was the form of the order that used to be issued under sect. 60
of the Common Law Procedure Act, 1854 . Any question,
therefore, fairly pertinent to the subjectmatter of the inquiry,
which means put with a view to ascertain so far as possible, by
discovery from a reluctant defendant, what debts are owing to
him, ought to be answered by the defendant. I am of opinion
that all the questions asked were fair questions in that sense, and
fairly pertinent and properly asked with a view of ascertaining
from the Defendant what debts were oRwing to him, and that
they ought all to have been answered. I am further of opinion
that he ought to answer all similar questions fairly directed to
that end, and that the order asked ought to have been made by
the ViceChancellor. He must answer all questions fairly directed
to ascertain from him what amount of debts is due, from whom
due, and to give all necessary particulars to enable the Plaintiffs
to recover under a garnishee order. I think therefore that the
order asked for below should be made now, and that the
Respondent should pay the costs of the appeal.
10.
JAMES, L.J.:—
I am of the same opinion. The examination is not only intended
to be an examination, but to be a crossexamination, and that of
the severest kind.”
In my view, the right to examine witness includes right to cross
examine and no prejudice would be caused to the Judgment Debtor if the
Judgment Creditor is allowed to cross examine the Judgment Debtor with a
view to ascertain the true and correct position of the property, assets and dues
of the Judgment Debtor so that the Judgment Creditor can apply for further
directions to this court so as to execute the decree.
11.
I am not inclined to accept the submission of Mr. Merchant that
the Guardian and Manager appointed by this court in Guardianship
petition, is liable to submit accounts of lunatic only in such guardianship
proceedings and action if any against such guardian and Manger can be taken
only in those proceedings. In my view, the guardian and Manager not only
represents the judgment debtor but has filed affidavit on his behalf and is
answerable to this court in this proceedings and is liable to be subjected to
cross examination.
12.
As far as judgment of the Supreme Court in the case of Municipal
Corporation of Greater Mumbai Vs. Lala Pancham and others, AIR
1965 SCC 1008 relied upon by Mr. Merchant, learned senior counsel
appearing for the Judgment Debtor is concerned, on perusal of the judgment,
it is clear that the Supreme Court was considering the petition impugning
the amendment of the plaint allowed by the High Court and remitting the
suit to the trial court and while doing so, the High Court had directed that
the Commissioner and City Engineer be examined on the question of breach
of assurance given to the tenants. Considering these facts, the Supreme Court
has held that just as it is not open to a court to compel a party to make a
particular kind of pleading or to amend his pleading so also it is beyond its
competence to virtually oblige a party to examine any particular witness. It
is held that it is duty of court of law not only to do justice but to ensure that
when justice is done, it should bear in mind that it must act only according to
law, not otherwise. In this mater, the Judgment Creditor seeks to cross
examine judgment debtor acting through guardian and Manager who has
filed affidavit pursuant to the order passed by this court under Order 21 rule
41 of C.P.C. 1908 disclosing assets, properties and debts of the Judgment
Debtor. In my view Order 21 Rule 41 permits examination of the judgment
debtor which includes cross examination of the judgment debtor. Reliance
thus placed by the learned senior counsel on the judgment of the Supreme
Court in the case of Municipal Corporation of Greater Bombay Vs. Lala
Pancham is totally misplaced and the said judgment does not assist the
judgment debtor.
13.
The Supreme Court in the case of Saiyad Mohammad Baker El
Edross Vs. Abdulhabibn Hasan Arab and Ors. 1998(2) G.L.R. 1781 has
held that the procedural law is always in aid of justice and not in
contradiction or to defeat the very object which is sought to be achieved. A
procedural law is always subservient to the substantive law. Nothing can be
given by a procedural law what is not sought to be given by a substantive law
and nothing can be taken away by the procedural law what is given by the
substantive law. In my view, procedure under Order 21, Rule 41 is in aid of
execution of decree with specific purpose to ascertain the true and correct
14.
position of assets and liabilities of the judgment Debtor.
I am therefore, of the view that the Judgment Creditor is entitled to
cross examine the Judgment Debtor on the contents of the affidavit filed by
the Judgment Debtor under Order 21 Rule 41 of the Code of Civil Procedure
and also on the authenticity of the contents of the documents relied upon.
Parties are at liberty to lead oral evidence before the Commissioner for
taking Accounts of this court.
16.
The question as to whether respondent through Anil Parekh, Guardian
and Manager of the respondent has complied with ad interim order passed by
this court or whether any further action should be taken against the said Mr.
Anil Parekh for warrant of arrest or not, the same can be decided only after
oral evidence of the respondent or his guardian and Manager is recorded as
directed by this court. After oral evidence is recorded, plaintiff would be at
liberty to apply for relief in terms of prayer clauses (c ) to (g) of the
Chamber summons. Liberty is granted to the parties to apply for placing the
Chamber Summons on board after evidence is recorded before the
Commissioner for Taking Accounts. Commissioner to act on the copy of this
order duly authenticated by the Associate of this Court.
Oral request of the learned counsel appearing for the respondent
(R.D.DHANUKA, J.)
for stay of operation of this order is rejected.
Print Page
Judgment Creditor to the affidavits filed by the Judgment Debtor, this court
cannot come to the conclusion that what is stated in the affidavit filed in
response to the order passed by this court, under Order 21 Rule 41, is
deemed to have been proved and no further enquiry about the correctness
thereof would be necessary. Punjab & Haryana High Court in the case of M/s.
Baru Ram Banarsi Dass (supra) has considered similar situation and has held
that the purpose of order 21 rule 41 of the Code of Civil Procedure is to
ascertain property if any owned by the Judgment Debtor so that the same may
be sold for recovery of the decretal amount. It is held that no prejudice
would be caused to the Judgment Debtor if he is cross examined provided he
has nothing to conceal from the court and if the Judgment debtor actually
does not have any property, he should have nothing to fear from his cross
examination. Punjab & Haryana High Court has held that the examination
within the purview of Order 21 Rule 41 of the Code of Civil Procedure,
includes cross examination because the purpose is to ascertain whether the Judgment Debtor has any property so that the money decree can be
satisfied. It is held that if cross examination is not permitted the Judgment
Debtor may falsely state that he does not own any property and if the
Judgment Debtor is cross examined, there would be nothing illegal therein. I
am in agreement with the views expressed by the Punjab and Haryana High
Court. In my view, the principle laid down by the Punjab & Haryana High
Court in the case of M/s. Baru Ram Banarsi Dass (supra) are applicable to
extended to this case.
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
CHAMBER SUMMONS NO. 1170 OF 2009
IN
EXECUTION APPLICATION (L) NO. 463 OF 2009
IN
AWARD NO. 8 OF 2004
M/s. LA'Builde Associates Vs Bipinchandra Narandas Dalal
CORAM : R.D. DHANUKA, J.
PRONOUNCED ON : 6TH SEPTEMBER, 2013
Citation;2013(6)ABR406, 2013(6)ALLMR497
By this Chamber Summons, the applicants (judgment creditors)
seeks directions against Mr.Anil Shantilal Parekh, guardian and Manager of
the respondent appointed by this court to disclose on oath by filing an
affidavit as to whether any debts are owing to the respondent and whether
respondent had right, title and/or interest on 22 nd April, 2004 or on that date
any other property and/or means for satisfying the dues under the award
dated 22nd April, 2004 passed by Shri. S.R.Shah, sole arbitrator including the
respondent's assets, moveables and immoveable properties, bank accounts,
jewellary, shares, securities, other investments, present source of income,
details of the respondent's business/employment and other profitable/gainful
activities carried out by the respondent and also to disclose all other details
required to be disclosed by Form No. 16A of Appendix “E” to the Code of Civil
Procedure, 1908 to facilitate the execution of the award dated 22 nd April,
2004 by the applicant. Applicants also seek a direction against said Mr.Anil
Shantilal Parekh to produce before this court and furnish to the applicants
true copies of all the books of account, statement, income tax returns for last
ten years of the respondent to enable the applicants to use those information
for executing the award dated 22nd April, 2004 and also seek an order of
months or for such period this court deem fit.
arrest and detention of Mr.Anil Shantilal Parekh in civil prison for three
2. Some of the relevant facts are as under :
(a)
By an agreement was executed between the applicants
and the respondent on 15th May, 1981, the respondent agreed to
sell to the applicants piece of land with tenant thereon situated at
Village Anik Chamber, Mumbai described in paragraph (4) of the
affidavit in support. Applicants paid Rs.3,20,000/ to the
respondent as and by way of earnest money. Dispute arose
between the parties and was referred to arbitration.
(b)
By an order dated 13th February, 1987 in Lunacy
Petition No. 4 of 1986, this court appointed Mr.Anil Shantilal
Parekh as guardian and Manager of the person and property of the
respondent. On 22nd April, 2004, Shri. S.R. Shah, Former Judge of
City Civil Court, Bombay who was appointed as sole arbitrator
made an award holding that the applicants could not be granted
claim for the specific performance but in lieu of specific
performance directed the respondent to pay to the applicants a sum
of Rs.2,50,00,000/ as damages with interest at the rate of 6% per
annum on the said amount from the date of award till payment.
Arbitration petition filed under section 34 of the
Arbitration and Conciliation Act, 1996 by the respondent for setting
aside the said award came to be rejected. It is the case of the
applicants that the application for restoration of the said petition is
pending, however, there is no stay of execution of the award.
Respondent filed a Miscellaneous Petition (2 of 1997) in this court
which was disposed of by the consent order dated 3 rd October, 1997
whereby the said property which was agreed to be sold to the
applicants by the respondent was directed to be sold to one Origin
Builders for Rs.80,00,000/ subject to the applicants' right.
(d)
On 17th July, 2009, the applicants filed this Chamber
Summons for various reliefs. On 8 th February, 2011, applicants
moved an application for leave to execute decree. By an order
passed by this court, notice filed under Order 21 Rule 22 is made
absolute after hearing the respondent. Respondent did not file any
appeal against the said order. By an order dated 6 th May, 2011,
respondent undertook to file his reply to the Chamber Summons
within two weeks from the date of the said order. This Court
granted adinterim reliefs in terms of prayer clauses (a) and (b) of
the said Chamber Summons. Prayers (a) and (b) of the Chamber
Summons are extracted as under :
“(a) That this Hon'ble Court be pleased to direct Shri.
Anil Shantilal Parekh, the guardian and Manager of the
ig
Respondent, appointed under the Order of the High Court
at Bombay in Lunacy Petition No. 4 of 1986 to file in this
Hon'ble Court within 2 weeks of such Order an Affidavit
and furnish to the Applicants copy thereof, within the said
period, stating on oath as to whether any debts are owing
to the Respondent and whether the Respondent had
right, title and/or interest as on date of the Order dated
22nd April, 2004 or has as on the date any other property
and/or means for satisfying the dues under the Award
dated 22nd April, 2004 passed by Shri. S.R. Shah, Sole
Arbitrator including the Respondent's assets, movable and
immovable properties, Bank Accounts, Jewellery, Shares,
Securities, other investments, present source of income,
details of the Respondent's business/employment and
other profitable/gainful activities being carried on by the
Respondent and thereby to disclose all other details
required to be disclosed by Form No. 16A of Appendix “E”
to the Civil Procedure Code, 1908 to facilitate the
execution of the said Award dated 22 nd April, 2004 by the
Applicants.
(b) That the said Shri. Anil Shantilal Parekh, the
guardian and Manger of the Respondent, appointed under
the Order of the High Court at Bombay in Lunacy Petition
No. 4 of 1986 be ordered and directed to produce before
this Hon'ble Court and furnish to the Applicants within 2
weeks of the Order or such time as may be prescribed by
this Hon'ble Court, true copies of all the Books of
Account, statement, Income tax returns for last ten years
of the Respondent to enable the Applicants to sue those
information for executing the said Award dated 22 nd April,
2004.”
(e)
On 17th May, 2011 Mr.Anil Shantilal Parekh, guardian
and Manager of the respondent filed an affidavit in this Chamber
Summons. It is stated in the affidavit that he has sold the
properties of the respondent after obtaining sanction of this court
and part of the sale proceeds was utilised for buying the flat which
was purchased in the name of the respondent and his daughter and
rest of the amount was kept in fixed deposit of bank as per order
passed by this court on 3rd August, 1997. It is stated in the affidavit
that by an order dated 1st August, 2003 passed in Miscellaneous
Petition No. 29 of 2003 in Lunacy Petition No. 4 of 1986, this court
granted leave to the said Mr. Anil Shantilal Parekh to withdraw
from the fixed deposit, amount spent by him from time to time
which included household expenses, expenses for hospital and
medicines, security expenses etc. In paragraph 21 of the said
affidavit, it is stated that debts of the respondent is at Rs.2,50,000/
payable as a legal expenses and professional fees to the advocates,
solicitors and Chartered Accountants as on 31 st March, 2011. In
paragraph 22, it is stated that as on 31 st March, 2011, the
respondent is not having any property. In paragraph 23, it is stated
that the balance in the bank account of the said respondent with
Jammu and Kashmir Bank Ltd., Kalbadevi Branch, Mumbai – 400
002 is at Rs.414/ on the date of filing that affidavit. In paragraphs
24 and 25, it is stated that as on 31 st March, 2011, respondent did
not have any moveable properties and respondent had Rs.38,087/.
In paragraph (26), it is stated that respondent does not have any
immoveable properties. Since there is no taxable income liable
under Income Tax Act, 1961, income tax returns have not been
filed with the Income Tax Authorities. Alongwith the said affidavit,
balance sheet from the period from 1 st April, 2003 to 31st March,
2011 have been annexed. In paragraph 29 of the said affidavit, it is
stated that the flat No. 2B at Vaibhav, 140, S.V.Road, Irla, Mumbai
– 400 056 was owned by the wife of lunatic and she had already
disposed of the said flat.
(f)
On 20th June, 2011, the said Mr.Anil Shantilal Parekh
filed additional affidavit stating that the respondent who is lunatic
is not involved in any employment, trade or profession and does
not have any annual, monthly or weekly income. Respondent does
not own any house or other immoveable property. Respondent
owned a residential house at 405, RNA Heights, Jogeshwari –
Vikhroli Link Road, Jogeshwari (E), Mumbai – 400 093 which was
sold at the market price by registered agreement to Mr.Krishnanand
Shaker Marvinkurve in the year 2005 for maintaining and up
keeping the respondent. Copy of the said agreement dated 17 th
November, 2005 has been annexed. It is stated in the additional
affidavit that as on the date of filing of the said affidavit,
respondent had Rs.414/ in his bank account No. 2010 with Jammu
and Kashmir Bank Ltd., Kalbadevi Branch, Mumbai – 400 002. He
did not have any stock and shares, life and endowment policies,
house property, other property and other securities. It is stated that
there are no debts due to the respondent. It is stated that some of
the properties were already sold by the respondent even prior to
the declaration of the arbitration award. It is stated that
professional fees of Rs.2,50,000/ could not be paid to the
chartered accountant and the advocate as there was no fund
available in the account of the respondent. It is stated that memo
of Arvind Rathod & CO. was for Rs.3,67,000/ out of which
Rs.2,25,000/ is still pending. In the said affidavit Mr.Anil S.
Parekh also annexed statement of accounts for the period from 1 st
April, 2004 till 31st March, 2011. The applicants did not file any
rejoinder to both these affidavits.
The Applicants filed contempt Petition (71 of 2011) in
(g)
this court against respondent and Mr. Anil Parekh for not
complying with the order passed by this court on 17 th November,
2011. By an order dated 6th May, 2011 passed by S.C.
Dharmadhikari,J. this court observed that it was apparent from the
affidavits and also from the contempt petition itself that the
ig
compliance was made on 17th May, 2011. It is however, observed
that the petitioners in the said contempt petition made allegations
that the said affidavit which was filed on 17/5/2011 in compliance
with order dated 6/5/2011 was absolutely vague and devoid of
any particulars or or contains misleading facts or false statements
were made therein, however, the same was not the matter which
could be decided in contempt petition. This court accordingly
dismissed the said contempt petition with such observations.
3. SUBMISSIONS OF MR. K.P. JAIN, COUNSEL FOR THE
APPLICANTS :
(a)
Mr. Kishore Jain, learned counsel for the applicants
submits that all questions arising between the parties to the suit
in which decree was passed or their representatives and relatives
to the execution be discharged or satisfaction of the decree has to
be determined by the Executing Court. It is submitted that the
provisions under Order 21 of the Code of Civil Procedure is not
substantive law but is a procedural in nature and gives
guidelines to the courts to do justice. It is submitted that in view of
the ex facie contradictions in the affidavits filed by the Judgment
Debtor and in view of the Judgment Debtor not complying with ad
interim order passed by this court on 6/5/2011, in terms of prayer
clauses (a) and (b), by disclosing various documents, non filing of
the rejoinder by the applicant to those two affidavits filed by the
Judgment debtor would not be of any consequence. He submits
that these two affidavits contain various false and incorrect
averments and discloses contradictions on the face of it and thus
does not deserve any credence. Mr. Jain submits that the court is
entitled to look into as to whether the averments made in the
affidavit filed pursuant to the order passed under Order 21 rule 41
are true or not. The court can even suo moto decide that such
affidavits are on the face of it false and contradictory. Mr.Jain
submit that though this court had directed the Judgment Debtor to
produce various documents described in prayer clauses (a) and (b)
of the Chamber summons, no such documents have been
produced by the Judgment Debtor. The Judgment Debtor also did
not produce any records directed to be produced by the ad
interim order dated 6/5/2011. Mr. Jain submits that the purpose
of granting prayer clauses (a) and (b) in favour of the applicant
was to find out the assets of the Judgment Debtor to enable the
applicants to execute the decree passed in its favour. Two weeks
period was granted to the Judgment Debtor to comply with the
said directions. This Court did not extend the time to comply with
the said ad interim order. The Judgment Debtor did not comply
with the said ad interim order dated 6/5/2011. In so far as
dismissal of the contempt petition filed by the applicant by this
court is concerned, Mr. Jain submits that the question as to
whether there are any misleading or false statement made in the
said affidavit or not are not decided in the said contempt petition
dismissed on 27th April, 2012. It is submitted that though this
court has dismissed the contempt petition, the allegations made in
those two affidavits which are ex facie false and misleading and
contradictory cannot be ignored by this court while deciding the
issue under Order 21 rule 41. The question that arises in this
proceedings are whether the Judgment Debtor has fully disclosed
all the assets and properties of the judgment Debtor with details,
particulars or not. Mr. Jain submits that merely because affidavits
are filed by the Judgment Debtor pursuant to the order passed by
this court, such affidavits cannot be accepted at its face value.
Mr. Jain submits that though the contempt petition is dismissed by
this court, this court can still see whether the records as directed
by this court are produced by the Judgment Debtor or not. It is
submitted that in these circumstances, the applicants did not file
rejoinder. It is submitted that since the documents as directed by
this court are not produced by the respondent, Judgment Creditor
could not verify the authenticity of the statements made in the
affidavit.
(b) That the intent of legislation under Order 21 rule 41 is to
find out assets and properties of the Judgment Debtor to enable
the Judgment Creditor to take steps to sell the said properties for
recovery of the decretal amount and for ascertaining the
correctness of such statements made in the affidavits and the
documents produced, if any, cross examination of such witness
would be must. It is submitted that oral examination permitted
under Order 21 rule 41, would be meaningful only by granting
opportunity to the Judgment Creditor to cross examine such
witnesses. Mr. Jain submits that to prevent any miscarriage of
justice, the court has power to undertake exercise of enquiry
to find out the assets so that the process of execution would
Mr. Jain invited my attention to annextures to the
(c)
come to its logical end.
affidavit dated 17/5/2011 filed by the Judgment Debtor through
Mr. Anil Parekh. It is submitted that Mr. Anil Parekh who has been
appointed as Manager and Guardian of the Lunatic is completely
in charge of the assets and properties of the respondent. Mr. Jain
pointed out from the statement annexed to the affidavit that
there is inconsistency in the affidavit. On one hand it is stated
that the respondent Judgment Debtor has no property and on the
other hand it is disclosed that he has sum of Rs.38,087/ with him.
The Judgment Creditor pointed out that the large amount of
interest is claimed to have been paid to Mr. Anil Parekh by the
respondent which are adjusted and recovered by him from the
amounts of the respondent lying with him. Deponent of those two
affidavits have recovered large amount of interest without
disclosing as to why such interest was paid to him and/or
recovered from respondent. It is submitted that Mr. Anil Parekh
has wiped of the entire assets by producing such fabricated
statement of accounts. Flat worth Rs.66 lacs which was owned by
the respondent also has been sold by the said Mr. Anil Parekh.
(d)
Mr. Jain placed reliance on the judgment of Punjab
and Haryana High Court delivered on 30 th March, 2010 in
Civil Revision No. 2000 of 2010 in support of his submission that
the court has power under Order 21 Rule 41 of the Code of Civil
Procedure to ascertain that the property if any owned by the
Judgment Debtors so that the same may be sold for recovery of the
decretal amount and cross examination of such witnesses can be
permitted. The relevant paragraphs of the said judgment read
thus :
“Decree holder filed application under Order 21, Rule 41 of
the Code of Civil Procedure ( in short "CPC") requiring the
petitionerJudgment Debtor to state about his properties.
The petitioner furnished affidavit Annexure P1 affirming
that the property owned by them as well as the firm had
already been auctioned and now, neither the firm nor the
partners individually had any moveable or immovable
property. Statement of the petitioner's partner Satpal was
recorded to the same effect. Decree Holder was permitted
to crossexamine the Judgment Debtor who admitted that
he had been filing income tax returns. His further cross
examination was deferred with direction to him to produce
income tax returns for the last two years. This order is
under challenge in the instant revision petition.
I have heard learned counsel for the petitioner
and perused the case file.
Learned counsel for the petitioner vehemently
contended that Order 21, Rule 41 of the CPC provides for
examination of the Judgment Debtor to ascertain his
properties but does not provide for crossexamination of
the Judgment Debtor for this purpose. Analogy was sought
to be drawn from the provision of Order 10, Rule 2 of the
CPC. The contention cannot be accepted. Purpose of Order
10, Rule 2 of the CPC is to record statement of either party
to clarify the pleadings of the parties to elucidate the
matter in controversy. However purpose of Order 21, Rule
41 of the CPC is to ascertain the property if any owned by
the Judgment Debtor so that the same may be sold for
recovery of the decretal amount. It is not explained how
Judgment Debtor/petitioner would be prejudiced if he is
crossexamined provided he has nothing to conceal from
the Court. If the petitioner actually has no property, he
should have nothing to fear from his crossexamination. On
the other hand, examination within the purview of Order
21, Rule 41 of the CPC, includes crossexamination because
the purpose is to ascertain whether the Judgment Debtor
has any property so that the money decree may be satisfied.
For the said purpose, if the Judgment Debtor is cross
examined, there would be nothing illegal in it. On the other
hand, if crossexamination is not permitted, the Judgment
Debtor may falsely state that he does not own any
property.”
(e)
Mr. Jain distinguished the judgment of the Supreme
Court in the case of Municipal Corporation of Greater Bombay
relied upon by Mr. Merchant, learned senior counsel appearing
for the Judgment Debtor on the ground that the Supreme Court
did not consider the issue under Order 21 rule 41 of the Code of
Civil Procedure in that matter and the issue raised by the parties in
this proceedings was not issue before the Supreme Court in that
ig
matter.
4. SUBMISSIONS OF MR. MERCHANT, LEARNED SENIOR COUNSEL
ON BEHALF OF RESPONDENT :
(a) That the authenticity of the affidavit filed by respondent
through his guardian and Manager cannot be dealt with by this
court under the provisions of Order 21 Rule 41. It is submitted
that the authenticity can be dealt with in perjury proceedings.
There is limited scope of enquiry under order 21 rule 41 as to
whether the property of the Judgment Debtor is available to the
Judgment Creditor or not for execution of the decree. It is
submitted that if the Judgment Debtor finds out that the
statements in the affidavit filed by the Judgment Debtor pursuant
to the order passed by this court under Order 21 Rule 41 are false
and misleading, the Judgment Creditor can always file perjury
proceedings against the Judgment Debtor for filing such false and
misleading affidavit. The Judgment Creditor can apply for
amendment if it is found that the other properties are available
which were not disclosed by the Judgment Debtor in the said
affidavit and file perjury proceedings. The Judgment Creditor
has not exercised that remedy. Learned senior counsel then
submits that the applicant did not file any rejoinder denying the
correctness of the contents of the of the assets and properties
disclosed by the Judgment Debtor in the affidavit filed under Order
21 rule 41. The Judgment Creditor cannot cross examine the
Judgment Debtor on the contents of the said affidavit filed in
response to the order passed by this court. It is submitted that if
this court wants to ask any question to the witness to ascertain
correctness of the contents of the affidavit filed by the Judgment
Debtor, the court can do so under Order 21 rule 41 but such
witness cannot be called upon by the Judgment Creditor for cross
examination.
(b) Various modes of execution are set out in Order 21 rule 30 for
money decrees. The application for examination of the Judgment
Debtor is not one of such mode of execution. Mr. Merchant
submits that various amounts allowed to be withdrawn or the
properties of the respondents which were sold by the Guardian
and Manager appointed by this court were sold after obtaining
sanction of this court. Various amounts which were allowed to be
withdrawn were withdrawn for the purpose of maintenance and
were spent on various expenditure incurred on the respondent. It is
submitted that the question as to whether Mr. Anil Parekh who
was appointed as Guardian and Manager of the respondent had
committed any breach of the duty as guardian and Manager of the
respondent and/or has misused any funds of the lunatic cannot be
gone into by this court under Oder 21 rule 41. Such issues can be
decided only in the proceedings in which the said Mr. Anil Parikh
was appointed as Guardian and Manager of the respondent who is
lunatic.
(c)
Reliance is placed on the judgment of the Supreme
Court in the case of Municipal Corporation of Greater Bombay
Vs. Lala Pancham and Others, AIR 1965 SC 1008 and in
particular para 6 and 15 in support of his submission that the
court cannot compel a party to examine any particular witness
and it would be beyond competence of the court under Order 21
rule 41 to issue such direction to Judgment Debtor to examine
the deponent of the affidavit. Paragraph 6 and 15 of the said
judgment reads thus :
“6. The trial court dismissed the suit mainly upon the
ground that it was not tenable. An appeal was taken by
the plaintiffs to the High Court which was dismissed
summarily by Datar J., on August 25, 1961. On the same
day the plaintiffs preferred an appeal under the letters
patent which went up before a Division Bench consisting
of Patel and Palekar JJ. The learned Judges permitted the
plaintiffs to amend the plaint overruling the objections of
the defendants. In their judgment the learned Judges
held that the suit was not barred. Then they proceeded to
consider the question of mala fides. According to them
the plaintiffs had pleaded mala fides but that they had
omitted to give particulars. They also observed that it
was true that no evidence was led by the plaintiffs before
the trial court and ordinarily they would not have been
entitled to lead fresh evidence at that stage, much less so
at the stage of the appeal under letters patent. According
to them, however, it is not possible to dispose of the case
on the material on record, that there are certain
documents on record which, if unexplained, "support in a
large measure the contention of the plaintiffs that
defendants 2, 3 and 4 obtained an order by fraud and
also that the order was mala fide." After referring to some
of these documents they observed : "Though therefore no
evidence is led on the question of mala fides or fraud
committed upon them, it prima facie leads to such an
inference, and it would not be proper to decide the
question without requiring further evidence." This
observation was followed by another which, we think, is
a very unusual one. It is this : "We particularly want the
Commissioner and the City Engineer and the defendants
to be examined on this question." Eventually, the learned
Judges remitted the case to the City Civil Court for
recording additional evidence and directed that Court to
certify the evidence and its findings by the end of
November, 1962. After the grant of special leave to the
appellants the proceedings before the City Civil Court
have been stayed.
15.
We are, therefore, of the view that the High
Court was in error in allowing the amendment to the
plaint and in remitting the suit to the trial court for a
virtual retrial. The High Court, however, did not rest
content with this order but further directed "we
particularly want the Commissioner and the City
Engineer and the defendants to be examined on this
question" the question being the breach of an assurance
given to the tenants. In making this direction the High
Court may have been actuated by a laudable motive but
we think it ought to have borne in mind the limits which
the law places upon the powers of the Court in dealing
with a case before it. Just as it is not open to a court to
compel a party to make a particular kind of pleading or
to amend his pleading so also it is beyond its competence
to virtually oblige a party to examine any particular
witness. No doubt, what the High Court has said is not in
terms a peremptory order but the parties could possibly
not take the risk of treating it otherwise. While therefore,
it is the duty of a court of law not only to do justice but
to ensure that justice is done it should bear in mind that
it must act according to law, not otherwise.”
(d)
That the Judgment Debtor has already complied with
the order passed by this court under Order 21 rule 41 by filing
two affidavits and has disclosed all the assets and properties of the
respondent. It is submitted that the applicant has not made any
application to cross examine deponents of the said two affidavits
and thus no order for cross examination of the deponent of the
said two affidavits can be passed by this court. Order 21 Rule 41
of the Code of Civil procedure is extracted as under :
“41. Examination of judgment debtor as to his property.
(1) Where a decree is for the payment of money the decree
holder may apply to the court for an Order that—
(a) the judgment debtor, or
(b) where the judgment debtor is a corporation, any officer
thereof, or
(c) any other person, be orally examined as to whether any
or what debts are owing to the judgment debtor and
whether the judgment debtor has any and what other
property or means of satisfying the decree; and the court
may make an order for the attendance and examination of
such judgment debtor, or officer or other person, and for
the production of any books or documents.
(2)
Where a decree for the payment of money has
remained unsatisfied for a period of, thirty years, the court
may, on the application of the decree holder and without
prejudice to its power under subrule (1), by order require
the judgment debtor or where the judgment debtor is a
corporation, any officer thereof, to make an affidavit stating
the particulars of the assets of the judgment debtor.
(3) In case of disobedience of any order made under sub
rule (2), the court making the order, or any court to which
the proceeding is transferred, may direct that the person
disobeying the order be detained in the civil prison for a
term not exceeding three month unless before the expiry of
such terms the court directs his release.”
On perusal of prayer clauses (a) and (b) of the ad interim order
5.
passed by this court, it is clear that Mr. Anil Parekh, Guardian and Manager of
the respondent was directed to state on oath as to whether any debts were
owing to respondent and whether he had any right, title or interest as on the
date of the order dated 22/4/2004 or has as on the date of the said order any
other property and/or means for satisfying the dues under the award dated
22nd April, 2004 including assets movable and immovable property, bank
accounts, jewellary, shares, securities, other investments, present source of
income, details of the respondent's business/employment and other
profitable/gainful activities being carried on by the respondent. Mr. Anil
Parikh was also directed to produced before this court true copies of all
books of accounts, statement, income tax returns for last ten years of the
respondent to enable the applicants to use those information for executing
the said award dated 22nd April, 2004. It is thus clear that the purpose of
granting such relief in favour of the Judgment Creditor and such direction
were issued to the Judgment Debtor and or his guardian and Manager to
produce various documents to ascertain the true and correct position of the
assets and properties of the Judgment debtor to enable the Judgment Creditor
to use those information for executing the decree passed in his favour. In
my view such direction issued under Order 21 rule 41 are not empty
formalities but are issued with specific purpose of collecting true and
correct information about the affairs and status of the properties and assets
of the Judgment Debtor which can be sold and realized for the purpose of
executing the decree obtained by the Judgment Creditor. In my view under
order 21 rule 41, not only this court is empowered to know the true and
correct details of assets and properties and debts of the Judgment Debtor
but in case of any dispute about the authenticity of the averments and
contents of the documents annexed to such affidavits and documents to
order oral examination of such deponent including cross examination. In my
view,Court is empowered to make further enquiry into the authenticity of the
averments and contents of the documents under Order 21 rule 41 and the
scope of enquiry under order 21 rule 41 is not limited as canvassed by
Mr.Merchant, learned senior counsel. If the court is satisfied prima facie that
the averments made in the disclosure affidavit does not disclose true and
correct affairs and the correct position of the assets/properties and debts of
the Judgment debtor, further enquiry into the correctness of such affidavit
and contents of documents is permissible under order 21 rule 41. In my
view Mr. Merchant, learned senior counsel appearing for the judgment
debtor is not correct in his submission that such enquiry has to be
independently made by the Judgment Creditor and if it is found that the
contents of that affidavit were false and misleading, the only remedy of the
Judgment Creditor would be to file perjury proceedings against the deponent
of such affidavit.
6.
On plain reading of Order 21 Rule 41 of the Code of Civil
Procedure, it is clear that the judgment Debtor or any other person on an
ig
application of the Decree holder may be ordered by court to be orally
examined to ascertain whether any debts are owing to the Judgment debtor
and whether said Judgment Debor has any property or means for satisfying
the decree and the court is empowered to even direct such Judgment debtor
or other person for production of any books or documents. It is clear that the
purpose of such oral examination is to ascertain the property owned by the
Judgment Debtor so that the same may be sold for recovery of decretal
amount.
7.
On perusal of the two affidavits field by Mr. Anil S. Parekh, the
Guardian and Manager of the respondent, I am of the prima facie view that
various amounts are claimed to have been recovered and/or appropriated by
the deponent of those two affidavits from the properties of the respondent
Judgment Debtor to himself towards payment of interest and other
expenditure. The deponent of those two affidavits appears to be in exclusive
control of all the assets and properties of the Judgment Debtor at least since
his appointment as Guardian and Manager of the respondent who is lunatic.
On perusal of the affidavits, it is also clear that all the documents directed to
be produced by this court by ad interim order have not been produced by the
respondent acting through as Guardian and Manager along with details.
ig
Various expenses are claimed and are alleged to have been paid by the
respondent through his Guardian and Manager and the balance if any of the
respondent is shown at negligible amount. Considering the nature of affidavit
filed by the respondent through his guardian and Manager, in my view, such
affidavit cannot be accepted at its face value and cannot be considered as
conclusive as far as debts, properties and assets of the Judgment Debtor are
concerned. In my view the Judgment Creditor is entitled to challenge such
expenditure claimed by the Judgment Debtor from the assets and properties
of the Judgment debtor. If it is found ultimately that the Judgment debtor has
filed false and misleading affidavit and has not given true and correct
position of the assets and debts of the Judgment Debtor and assets and
properties of the Judgment Debtor are available then the Judgment Creditor
would be able to recover amounts in execution of the decree in his favour. If
it is found that the Judgment Debtor has to recover any amount lying in the
hands of third party, the Judgment Creditor can always apply for attachment
of those properties and or recoverables lying with the third party by filing
garnishee proceedings.
8.
In my view, merely because affidavit in rejoinder is not filed by the
Judgment Creditor to the affidavits filed by the Judgment Debtor, this court
cannot come to the conclusion that what is stated in the affidavit filed in
response to the order passed by this court, under Order 21 Rule 41, is
deemed to have been proved and no further enquiry about the correctness
thereof would be necessary. Punjab & Haryana High Court in the case of M/s.
Baru Ram Banarsi Dass (supra) has considered similar situation and has held
that the purpose of order 21 rule 41 of the Code of Civil Procedure is to
ascertain property if any owned by the Judgment Debtor so that the same may
be sold for recovery of the decretal amount. It is held that no prejudice
would be caused to the Judgment Debtor if he is cross examined provided he
has nothing to conceal from the court and if the Judgment debtor actually
does not have any property, he should have nothing to fear from his cross
examination. Punjab & Haryana High Court has held that the examination
within the purview of Order 21 Rule 41 of the Code of Civil Procedure,
includes cross examination because the purpose is to ascertain whether the
Judgment Debtor has any property so that the money decree can be
satisfied. It is held that if cross examination is not permitted the Judgment
Debtor may falsely state that he does not own any property and if the
Judgment Debtor is cross examined, there would be nothing illegal therein. I
am in agreement with the views expressed by the Punjab and Haryana High
Court. In my view, the principle laid down by the Punjab & Haryana High
Court in the case of M/s. Baru Ram Banarsi Dass (supra) are applicable to
extended to this case.
9.
the facts of this case also and the principle laid down therein can be
In the case of Republic of Costa Rica Vs. Strousberg Vol. 16
Chancery Division Page 8, similar facts and provision which is in para materia
with Order 21 Rule 41 has been construed and similar question raised in
this proceeding was subject matter of the said proceedings. It is held that the
examination of the witness is not only intended to be an examination, but to
be a crossexamination, and that of the severest kind. It is held that all the
questions asked were fair questions in that sense, and fairly pertinent and
properly asked with a view of ascertaining from the Defendant what debts
were owing to him, and that they ought all to have been answered. It is
further held that he ought to answer all similar questions fairly directed to
that end, and that the order asked ought to have been made by the Vice
Chancellor. He must answer all questions fairly directed to ascertain from
him what amount of debts is due, from whom due, and to give all necessary
particulars to enable the Plaintiffs to recover under a garnishee order. In my
view the principles laid down in Chancery Division on construction of the
provisions, which are in para materia with Order 21 Rule 41 of the Code of
Civil Procedure are applicable to the facts of this case and can be extended
to the matter in hand. I am in agreement with the views expressed by the
Chancery Division. Relevant paragraph of the said judgment in the case of
Republic of Costa Rica read thus :
“The Republic of Costa Rica obtained judgment against Mr.
Strousberg . Rule 1 of Order XLV. of the Rules of Court, 1875 ,
is this:—“Where a judgment is for the recovery by or payment to
any person of money, the party entitled to enforce it may apply
to the Court or a Judge for an order that the judgment debtor be
orally examined as to whether any and what debts are owing to
him, before an officer of the Court, or such other person as the
Court or a Judge shall appoint; and the Court or Judge may
make an order for the examination of such judgment debtor, and
for the production of any books or documents.” It appears that
this clause is copied in substance from the 60th section of the
Common Law Procedure Act, 1854 , which enacts that, “It shall
be lawful for any creditor who has obtained a judgment in any of
the superior Courts to apply to the Court or a Judge for a rule or
order that the judgment debtor shall be orally examined as to
any and what debts are owing to him before a Master of the
Court, or such other person as the Court or Judge shall appoint;
and the Court or Judge may make such rule or order for the
examination of such judgment debtor, and for the production of
any books or documents. ...” Now, considering that that is a
power which has been in force ever since 1854, it is certainly
somewhat remarkable that no authority can be produced on
either side as to how that examination ought to be conducted,
or to what extent it can be justifiably carried. But the Plaintiffs in
this case, availing themselves of that power, have obtained an
order for the examination of the Defendant. Now the only
subject on which he was to be examined was, what debts are
owing to him. It appears that Mr. Kekewich conducted this
examination; and it does appear to me that this is a power which
is to be strictly construed. The object of this examination
evidently is for the purpose of ascertaining from the judgment
debtor what debts are owing to him, in order that the judgment
creditor may attach those debts. It is in the nature of a discovery;
and it appears to me very much like thRe discovery of
documents where a defendant is asked what documents he has,
and he sets out what documents he has: but you cannot cross
examine him upon that. You must take his statement to be
correct. Now here, where you are to crossexamine him as to
what debts are owing to him, I think you may go to this extent:
you may ask him, “What debts are owing to you?” and if he gives
you the answer you may very well say, “Does not your banker
owe you any balance?” “Is there not a Rbalance due to you on a
contract in which you are engaged?”—and he is certainly bound
to answer; but it does appear unquestionable that Mr. Kekewich
here thought himself at liberty to go beyond the mere object of
asking what debts are owing, because he asked him, “Are you
carrying on any business at the present time?” I do not think,
under the circumstances of the case, it was necessary to ask him
whether he was carrying on business at the present time. Then
he was asked, “Are any debts owing to you?” Then he was asked,
“Are you a contractor? Is any money now due to you on any
contract now completed?” He said, “I do not understand the
question. No money is now due to me under any contract except
the contract above referred to.” Then he is asked, “Have you any
contracts pending?” Then he says, “I shall answer no questions
except as to what debts are owing to me.” Then there is this,
“Are you not a contractor by profession?” Now why should he be
asked whether he is a contractor by profession? They knew
perfectly well what he was; they knew perfectly well all about
him, and all they wanted to know was what debts were owing to
him, in order that they might *11 exercise the power of issuing
an attachment against those debts. I think, therefore, the
examination was carried beyond the object authorized by the
rule, but I am also very much impressed by the opinion that Mr.
Strousberg , being advised by counsel, refused to answer
questions which, I think, he might very well have answered.
However, my construction of the Act is that they were not at
liberty to make a general examination. With every respect for
Mr. Kekewich , I think he went there rather in the spirit of a
crossexaminer than as a mere examiner as to what debts were
owing to Mr. Strousberg . The object of the rule is simply to
ascertain whether a debtor has any debts owing to him in order
that they may be attached. To that question, in my opinion, the
questions ought to have been confined. He might have been
asked, “What debts are owing to you?” And he might have said,
“ A. B. owes me so much money, and C. D. owes me so much
money.” If the examining counsel were not satisfied with that,
he might have asked, “Have you any balance at your bankers?”
and take his answer, “Yes or no.” Therefore I think the
examination went beyond its just bounds. At the same time, I
think the answers were more curt than they might have been.
Therefore, upon the whole, I cannot make any order that Mr.
Strousberg should attend to answer these general questions
which were put to him. He must attend for the purpose of
answering the simple question authorized by the rule—what
debts are owing to him—and no others. I think there has been
overzeal on the part of the Plaintiffs. I think they have been
carrying the matter a little too far, and I rather had an
inclination to dismiss their motion with costs; but on the whole,
considering all the circumstances, I think it will be better to
dismiss it without costs.
The Plaintiffs appealed from this decision. The appeal was heard
on the 4th of November.
Glasse , Q.C., Kekewich , Q.C., and H. A. Giffard , for the
Appellants:—
If the Respondent is entitled to restrict the examination to the
simple question as to whether any debts are due to him, the
order will be a nullity. We submit he is bound to answer all
questions relevant to the subjectmatter which will tend to give
the Plaintiffs the discovery they seek, otherwise what is the use
of requiring him to attend with and produce books, vouchers,
documents, and the like?
Higgins , Q.G., and Medd , for the Respondent:—
hvn
The order is a very stringent one, and must be construed strictly.
The Respondent has complied with the order made against him.
The questions put were quite irrelevant to the subjectmatter.
JESSEL, M.R.:—
I think this appeal must succeed. As I understand the rule, the
examination is to be “as to whether any and what debts are
owing to the judgment debtor.” That means exactly the same
thing as “touching the debts owing the judgment debtor,” which
was the form of the order that used to be issued under sect. 60
of the Common Law Procedure Act, 1854 . Any question,
therefore, fairly pertinent to the subjectmatter of the inquiry,
which means put with a view to ascertain so far as possible, by
discovery from a reluctant defendant, what debts are owing to
him, ought to be answered by the defendant. I am of opinion
that all the questions asked were fair questions in that sense, and
fairly pertinent and properly asked with a view of ascertaining
from the Defendant what debts were oRwing to him, and that
they ought all to have been answered. I am further of opinion
that he ought to answer all similar questions fairly directed to
that end, and that the order asked ought to have been made by
the ViceChancellor. He must answer all questions fairly directed
to ascertain from him what amount of debts is due, from whom
due, and to give all necessary particulars to enable the Plaintiffs
to recover under a garnishee order. I think therefore that the
order asked for below should be made now, and that the
Respondent should pay the costs of the appeal.
10.
JAMES, L.J.:—
I am of the same opinion. The examination is not only intended
to be an examination, but to be a crossexamination, and that of
the severest kind.”
In my view, the right to examine witness includes right to cross
examine and no prejudice would be caused to the Judgment Debtor if the
Judgment Creditor is allowed to cross examine the Judgment Debtor with a
view to ascertain the true and correct position of the property, assets and dues
of the Judgment Debtor so that the Judgment Creditor can apply for further
directions to this court so as to execute the decree.
11.
I am not inclined to accept the submission of Mr. Merchant that
the Guardian and Manager appointed by this court in Guardianship
petition, is liable to submit accounts of lunatic only in such guardianship
proceedings and action if any against such guardian and Manger can be taken
only in those proceedings. In my view, the guardian and Manager not only
represents the judgment debtor but has filed affidavit on his behalf and is
answerable to this court in this proceedings and is liable to be subjected to
cross examination.
12.
As far as judgment of the Supreme Court in the case of Municipal
Corporation of Greater Mumbai Vs. Lala Pancham and others, AIR
1965 SCC 1008 relied upon by Mr. Merchant, learned senior counsel
appearing for the Judgment Debtor is concerned, on perusal of the judgment,
it is clear that the Supreme Court was considering the petition impugning
the amendment of the plaint allowed by the High Court and remitting the
suit to the trial court and while doing so, the High Court had directed that
the Commissioner and City Engineer be examined on the question of breach
of assurance given to the tenants. Considering these facts, the Supreme Court
has held that just as it is not open to a court to compel a party to make a
particular kind of pleading or to amend his pleading so also it is beyond its
competence to virtually oblige a party to examine any particular witness. It
is held that it is duty of court of law not only to do justice but to ensure that
when justice is done, it should bear in mind that it must act only according to
law, not otherwise. In this mater, the Judgment Creditor seeks to cross
examine judgment debtor acting through guardian and Manager who has
filed affidavit pursuant to the order passed by this court under Order 21 rule
41 of C.P.C. 1908 disclosing assets, properties and debts of the Judgment
Debtor. In my view Order 21 Rule 41 permits examination of the judgment
debtor which includes cross examination of the judgment debtor. Reliance
thus placed by the learned senior counsel on the judgment of the Supreme
Court in the case of Municipal Corporation of Greater Bombay Vs. Lala
Pancham is totally misplaced and the said judgment does not assist the
judgment debtor.
13.
The Supreme Court in the case of Saiyad Mohammad Baker El
Edross Vs. Abdulhabibn Hasan Arab and Ors. 1998(2) G.L.R. 1781 has
held that the procedural law is always in aid of justice and not in
contradiction or to defeat the very object which is sought to be achieved. A
procedural law is always subservient to the substantive law. Nothing can be
given by a procedural law what is not sought to be given by a substantive law
and nothing can be taken away by the procedural law what is given by the
substantive law. In my view, procedure under Order 21, Rule 41 is in aid of
execution of decree with specific purpose to ascertain the true and correct
14.
position of assets and liabilities of the judgment Debtor.
I am therefore, of the view that the Judgment Creditor is entitled to
cross examine the Judgment Debtor on the contents of the affidavit filed by
the Judgment Debtor under Order 21 Rule 41 of the Code of Civil Procedure
and also on the authenticity of the contents of the documents relied upon.
Parties are at liberty to lead oral evidence before the Commissioner for
taking Accounts of this court.
16.
The question as to whether respondent through Anil Parekh, Guardian
and Manager of the respondent has complied with ad interim order passed by
this court or whether any further action should be taken against the said Mr.
Anil Parekh for warrant of arrest or not, the same can be decided only after
oral evidence of the respondent or his guardian and Manager is recorded as
directed by this court. After oral evidence is recorded, plaintiff would be at
liberty to apply for relief in terms of prayer clauses (c ) to (g) of the
Chamber summons. Liberty is granted to the parties to apply for placing the
Chamber Summons on board after evidence is recorded before the
Commissioner for Taking Accounts. Commissioner to act on the copy of this
order duly authenticated by the Associate of this Court.
Oral request of the learned counsel appearing for the respondent
(R.D.DHANUKA, J.)
for stay of operation of this order is rejected.
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