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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS.8531 -8532 OF 2022

(ARISING FROM SLP (CIVIL) NO.21943 -21944 OF 2018)

BHAGYODAY COOPERATIVE BANK LTD. APPELLANT(S)

VERSUS

RAVINDRA BALKRISHNA PATEL DECEASED.

THROUGH HIS LRS. & ORS. RESPONDENT(S)

J U D G M E N T

K.M. JOSEPH, J.

Leave granted.

2. The woes of a decree holder begin after obtaining a

decree. It is in execution that a decree holder is confronted with

an unimaginably large number of obstacles. With the facts as

unfolded in the course of the judgment, we are reinfor ced in our

belief that there is substance in this complaint.

3. The appellant-Bank granted a financial facility to a firm

(M/s. Vimal Traders, Partnership Firm ). There were three partners,

namely, Ravindra Balkrushna Patel and Nikhil Balkrushna Patel who

are brothers and the third person was Shri Gautam Vishnuprasad

Tripathi. Since the amount was not repaid, a Lavad Suit

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No.2265/1984 came to be filed by the appellant -bank before the

Board of Nominees under The Gujarat Co-operative Societies Act,

1961 (hereinafter referred to as 'the Act' ). The adjudicatory body

passed an order on 23.09.1988. The operative portion of the order

reads as follows: -

"The defendants to make payment of

Rs.2,61,314.34ps. with 20.5% interest p.a. from

the date of suit till real isation and cost of the

suit to the plaintiff latest by 31.03.1989. The

garnish order passed below Exh.6 is made absolute

and the plaintiff is at liberty to execute the

award against the G.S.I.C. for the said amount of

Rs.1,50,000/- taking due process of l aw after

31.03.1989. Lavad fee of Rs.510/ - deposited by the

plaintiff to be credited to the Government as

fees.

Award accordingly

Given and pronounced in open Court on

23.09.1988."

4. We may notice at this juncture itself Section 103 of the

Act. It reads as follows: -

"103. Money how recovered. - Every order

passed by the Registrar or a person

authorised by him under Section 93, or by

the Registrar, his nominee or board of

nominees under Section 100 or 101, every

order passed in appeal under Section 10 2,

every order passed by a Liquidator under

Section 110, every order passed by the State

Government in appeal against orders passed

under Section 110 and every order passed in

revision under Section 155, shall if not

carried out,-

(a) on a certificate sig ned by the

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Registrar or a Liquidator, be

deemed to be a decree of a Civil

Court, as defined in clause (2) of

Section 2 of the Code of Civil

Procedure, 1908 and shall, be

executed in the same manner as a

decree of such Court, or

(b) be executed according to the

provisions of the Land Revenue

Code and the rules thereunder for

the time being in force for the

recovery of arrears of land

revenue:

Provided that, any application for the

recovery in such manner of any such sum shall b e

made to the Collector, and shall be accompanied

by a certificate signed by the Registrar, or by

any Assistant Registrar to whom the said power

has been delegated by the Registrar. Such

application shall be made within twelve years

from the date fixed in the order and if no such

date is fixed, from the date of the order. "

5. On the application apparently made by the appellant -Bank,

the certificate contemplated under Section 103 (a) of the Act came

to be issued on 17.09.1995. In view of the provisions of Section

103 of the Act, since the order passed under Section 103 of the Act

in this case is to be executed in the same manner as a decree of a

Civil Court as defined in clause (2) of Section 2 of the Code of

Civil Procedure, 1908 (For short 'CPC'), the ap pellant initially

filed Execution Application No.777/1995 before the City Civil

Court, Ahmedabad. It would appear that the notice was not served

in the Execution Application No.777/1995 and the appellant

according to it tried to serve the notice but it fa iled. Thereupon,

the Execution Court passed the following order on 22.10.1997, which

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reads as under:-

"When matter called out, neither darkhastdar

nor his L.A. is present. From the record, it

appears that the darkhastdar has not taken any

effective steps since long. However, in the

interest of justice, darkhastdar is granted,

time till 27.11.1997. If no effective step is

taken till than the darkhastdar - petition will

stand automatically dismissed on 27.11.1997."

6. Still further, the appellant on 27.11 .1997 gave a new

address and filed an application. It is the further case of the

appellant that the Court was not working and there was a strike and

the case stood posted to 10.12.1997. During the pendency of the

Execution Application No.777 of 1995, a Jan gam Warrant was issued

against the respondents for recovery of Rs.8,74,033.49/ - by order

dated 15.07.1998. On 02.02.2005, the appellant -Bank filed an

application seeking withdrawal of the Execution Application with

liberty to file the petition before the C ourt of competent

jurisdiction. This was occasioned according to the appellant -Bank

by shifting of the residence of the respondents. According to the

appellant-Bank, the said application was allowed and the Execution

Application was permitted to be withdra wn by order dated

02.02.2005. On 19.01.2006, the appellant filed an execution

petition before the 4th Additional Senior Civil Judge (Ahmedabad

Rural).

7. At this juncture, we must notice another aspect. It would

appear that the appellant -Bank had obtained a decree against M/S.

Virat Paper Processors (a partnership firm) in which again

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Ravindra Balkrushan Patel and Nikhil Balkrushna Patel (hereinafter

for brevity 'Patel brothers') were partners along with Hemant

Balkrushna Patel (not a party herein). It must be noticed that all

the three were brothers though the firm was a different firm. The

deemed decree obtained against the said parties in Lavad Suit

No.576/1988 again under the Act, was put to execution. It is here

we must note another person whose ro le will become clear i.e.,

Savitaben Balkrushna Patel (Deceased) -the mother of the Patel

brothers, who stood as guarantor for the loan granted in the

transaction which led to Lavad Suit No.576/1998. Her property was

finally put to sale in the Court auction . A sum of Rs.39,25,000/ -

was fetched and it was lying in deposit. The mother of the Patel

brothers expired on 18.06.2005.

8. Resuming the narrative with reference to the developments

in the suit with which we are con cerned, after filing of the

execution petition as it were by the appellant in the new Execution

Court apparently based on the developments in the other suit namely

the holding of the Court auction in connection with the enforcement

of the liability of the mother as guarantor, an application came to

be filed on 24.01.2007. The purport of the application appears to

be to obtain satisfaction of the deemed decree with reference to

the amount which was realized in the Court auction. We may only

notice the prayer as we find from Annexure -P7 of the SLP paper

book, which is as follows: -

"A. In connection with the Special Darkhast no.

80/99, the property of the opponents was sold

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by initiating legal procedure and amount

thereof to the tune of Rs. 39,25,000/ - rupees

thirty Nine lacs twenty five thousand only is

deposited before the Court in Special Darkhast

no. 80/99 and after deducting the outstanding

amount in special Darkhast no. 80/99 with

interest and cost, remaining amount is likely

to be credited and that amou nt is to be given

to the opponents no. 2 and 3 thus, your honour

may be pleased to pass order of garnishi and

direct the registrar/Nazir of the Court of

learned Civil Judge (S.D.) Saheb to deposited

the remaining credited amount in the said

execution.

B. Your honour may be pleased to pass such

other and further relief as may be deemed fit.

C. Your honour may be pleased to pass order to

send one copy of the order of this Garnishi

application to keep it in Special Darkhast no.

80/99 pending before the Court o f Shri BB

Pathak sahib, Civil Judge S.D. Ahmedabad

Rural."

9. The Patel brothers who are judgment debtors in the instant

case filed their objections. After considering their objections,

the Execution Court passed the following order.

"Objection application Ex. 28 filed by

the opponents no. 2 and 3 is hereby

dismissed.

Under the provisions of order 21 Rule

46A of the CPC, the Registrar and Nazir

of the Court of Principal Senior Civil

Judge Saheb, Ahmedabad (rural) is hereby

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ordered to deposit the actual remaining

amount in this Darkhast after making

payment of the D arkhast, interest and

cost come on the share of opponent

Ravindra Balkrishna Patel and Nikhil

Balkrishna Patel out of the credited

amount in Special Darkhast No.80 -99.

This order has been declared today on

this 10.04.2013 in the open Court."

It is this order which came to be challenged before the High

Court by the Patel brothers. The High Court by the impugned order

has set aside the order passed by the Execution Court. It is being

aggrieved thereby that the appellant -Bank is before us.

10. We heard Mr. Preetesh Kapur, learned senior counsel for

the appellant and also Mr. Aniruddha Deshmukh, learned counsel

appearing on behalf of the Patel brothers, including the

partnership firm.

THE FINDINGS IN THE IMPUGNED ORDER

11. The High Court finds that the e arlier execution petition

filed in the first Execution Court, namely, Execution Application

No.777/1995, having been dismissed, the application which is filed

subsequently in the year 2006 before the Second Execution Court, if

we may describe it as such wa s not maintainable. It is found that

the first application having been dismissed for default, the proper

course would have been to approach the said Court within the period

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of limitation. It is found that the said order dismissing the

execution application should have been set aside within a period of

30 days since Section 5 of the The Limitation Act, 1963 is not

available in execution proceedings, the subsequent execution

petition is barred.

12. Next, it is found that in view of Section 38 of CPC a

decree could be executed either by the Court which passed it or the

Court to which the decree was transferred. Section 39 of the CPC

provides for the exclusive mechanism by which the decree could be

ordered to be transferred. In the facts of this case, it was found

there was no approach made by the appellant -Bank to the Court in

which the execution petition was originally filed to get it

transferred to the second Court in which without an order under

Section 39, the appellant -Bank filed the second application in the

year 2006. Therefore, the very petition filed before the Execution

Court on the second occasion was not maintainable.

13. Further, the Court elaborated on the flaw involved in the

application maintained under Order 21 Rule 46A of CPC and, more

importantly, the actual order that was passed thereunder. The

reasoning of the High Court is as follows: - Before an order is

passed under Order 21 Rule 46A of the CPC, there must be an

attachment of the debt. There was no attachment of the debt within

the meaning of Order 21 Rule 46 of CPC. It is found that Order 21

Rule 46 of CPC insisting on an order of attachment as is clear from

a perusal of Order 21 Rule 46A of CPC serves a salutary purpose. It

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affords an opportunity to the person aggrieved that is the

garnishee to raise his objection to the attachment. Valuable rights

are vouchsafed to the garnishee and the right is to be enforced

through the mechanism of Order 21 Rule 46C. Order 21 Rule 58

provides for objection to attachment. A person aggrieved by an

order under Order 21 Rule 58 of CPC has further rights in the form

of the appeals as provided in law. In this case, it was found that

without observing the mandatory requirement of attachment it is

that the Execution Court had allowed the prayer under Orde r 21 Rule

46A. It must be noticed that though the argument relating to the

execution petition being barred by limitation was pursued

vigorously before the Execution Court, it was not pressed before

the High Court by the respondents.

CONTENTIONS OF THE PARTIES

14. Mr. Preetesh Kapur, learned senior counsel for the

appellant would with reference to the facts as we have noticed make

the following submissions. He would point out that the mere fact

that the earlier execution petition was dismissed would not stand

in the way of the processing and considering of the second

execution petition. The execution petition was dismissed only if at

all on account of default. In fact, it was withdrawn with liberty.

But even if it is dismissed on default, in view of the law laid

down by judgment of this Court in 1969 (1) SCC 718 , Shivashankar

Prasad Shah and Others Versus Baikunth Nath Singh and Others, the

second petition was mainta inable. It was held as follows in the

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said decision: -

"6. The courts in India have ge nerally

taken the view that an execution petition

which has been dismissed for the default of

the decree-holder though by the time that

petition came to be dismissed, the

judgment-debtor had resisted the execution

on one or more grounds, does not bar the

further execution of the decree in

pursuance of fresh execution petitions

filed in accordance with law -see Lakshmibai

Anant Kondkar v. Rayji Bhikaji Kondkar ,

(XXXI, BLR 400). Even the dismissal for

default of objections raised under Section

47, Civil Proced ure Code does not operate

as res judicata when the same objections

are raised again in the course of the

execution-see Bahir Das Pal and Another v.

Girish Chandra Pal, AIR 1923 Cal 287;

Bhagwati Prasad Sah v. Radha Kishun Sah and

Others, AIR 1950 Pat 354; Jethmal and

Others v. Mst. Sakina, AIR 1961 Raj 59;

Bishwannath Kundu v. Smt. Subala Dassi, AIR

1962 Cal 272 . We do not think that the

decision in Ramnarain v. Basudeo, ILR XXV

Pat 595 on which the learned counsel for

the appellant placed great deal of rel iance

is correctly decided. Hence we agree with

the High Court that the plea of res

judicata advanced by the appellant is

unsustainable."

15. The dismissal of the earlier execution petition on the

ground of default will not bar th e filing of a fresh execution as

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long as the second petition is filed within the period of

limitation. In this case, limitation would begin to run only on

obtaining the certificate contemplated under Section 103 of the

Act. The certificate was obtained in the year 1995. Therefore, the

second execution petition filed in the year 2006 was well within

the period of 12 years and therefore the execution petition is not

barred. As far as the findings of the High Court that Sections 38

and 39 of the CPC governed the facts of the case, it is contended

that the Court has erred in not bearing in mind the following a

vital feature present in this case. This is not a case where a

decree has been passed by a Civil Court. What has happened is in

terms of the Act on a cla im by the appellant -Bank which is a

creditor the matter was adjudicated in the form of an arbitration

proceeding. At the end of the adjudication, the plaintiff being

successful, an award was passed. After the award is passed, a

certificate has to be applie d for. The certificate is granted under

Section 103 of the Act. The certificate granted under Section 103

of the Act only results in the order passed becoming executable as

a decree. He further points out that even after the certificate is

passed it is not as if the order was a decree as such. All that the

law provides is that it is enforceable as a decree. He would submit

that similar provisions are contained in the Arbitration and

Conciliation Act, 1996.

16. He drew our attention in this regard to the judgment of

this Court reported in Sundaram Finance Limited versus Abdul Samad

and Another, (2018) 3 SCC 622. Therein this Court was considering

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the question which was similar to the question which arises in the

facts of this case, namely, whether the fili ng of the execution

petition is governed by the regime provided under Sections 38 and

39 of the CPC. We notice the following, inter alia, discussion: -

"14. We would now like to refer to the provisions of

the said Act, more specifically Section 36(1), which

deals with the enforcement of the award:

“36. Enforcement. — (1) Where the time

for making an application to set aside

the arbitral award under Section 34 has

expired, then, subject to the provisions

of sub-section (2), such award shall be

enforced in accordance with the

provisions of the Code of Civil

Procedure, 1908 (5 to 1908), in the same

manner as if it were a decree of the

court.”

The aforesaid provision would show that an award is

to be enforced in accordance with the provisions of

the said Code in the same manner as if it were a

decree. It is, thus, the enforcement mechanism,

which is akin to the enforcement of a decree but the

award itself is not a decree of the civil court as

no decree whatsoever is passed by the civil court.

It is the Arbitral Tribunal, which renders an award

and the tribunal does not have the power of

execution of a decree. For the purposes of execution

of a decree the award is to be enforced in the same

manner as if it was a decree under the said Code.

20. We are, t hus, unhesitatingly of the view that

the enforcement of an award through its execution

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can be filed anywhere in the country where such

decree can be executed and there is no requirement

for obtaining a transfer of the decree from the

court, which would hav e jurisdiction over the

arbitral proceedings."

17. He would therefore submit that once second application was

not barred by limitation, a fresh execution petition could be filed

in the Court which would have jurisdiction. The jurisdiction of the

second Court would have to be determined with reference to the

element of the residence of the judgment debtors within the

jurisdiction of that Court or the existence of property as the case

may be within the limits of the Courts jurisdiction. As far as the

finding that Order 21 Rule 46 of CPC was observed in its breach

before the Court passed the Order 21 Rule 46A of CPC, he would

submit that the garnishee in the case is not the mother of the

Patel brothers. In fact, the mother as noticed had passed away in

the year 2005 and the application itself was filed only in the year

2007. The case of the appellant is that after the auction was held

in execution of the decree in the other suit filed by the appellant

after satisfying the decree debt in the said case, there was an

excess sum. It belonged to the mother and it was lying in deposit

and as the mother passed away, therefore, it became payable by the

Court's Nazir to the judgment debtors in the said case two of whom

are the judgment debtors being the Patel brothers in volved in this

case also. Therefore, the argument is that it is the Court Nazir

who is the garnishee as he was under an obligation or debt to make

payment of the said amount to the judgment debtors which included

Patel brothers involved in this case. He wo uld further submit that

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with reference to the wide powers available to the Execution Court

under Section 51 of CPC that at any rate it would be highly unjust

to deny the decree holder the fruits of its decree and to proscribe

the Court from getting at asse ts of the judgment debtors which were

lying in a deposit in the same Court. In other words, the proceeds

of the Court auction after satisfying the decree debt of the

appellant in the other case and payable to the judgment debtors

after death of the guarant or (mother) was lying in deposit of the

second Execution Court. On the strength of the powers available

under Section 51 as also inherent power under Section 151 of CPC,

the Court must be ceded the power to make available the said amount

for appropriation by the decree holder.

18. Per-contra, learned counsel for the respondents, Mr.

Aniruddha Deshmukh stoutly opposes the contentions. He would point

that as far as the interpretation placed under Sections 38 and 39

of CPC by the High Court is concerned it is unexceptionable. When

confronted with the judgment of this Court, in Sundaram Finance

Limited (supra) relied upon by the learned counsel for the

appellant, he would make an attempt at distinguishing the said

judgment. This attempt is bolstered with refe rence to the words

'decree as defined in clause (2) of Section 2 of CPC' as found in

Section 103 of the Act. He would submit that this distinguishable

text of the Act with which this Court is concerned may render the

principle laid down by the judgment of this Court not applicable.

He would further point out that the High Court was entirely right

in its interpretation of Order 21 Rule 46 and Order 21 Rule 46A. He

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supported his contention in this regard to three judgments of the

High Courts which are as follows: - Nuthalapati Kotaiah vs.

Executive Officer TTD Office at Guntur, (1985) 3 AP LJ 103, The

Madurai City Municipal Corporation, represented by its

Commissioner, Madurai vs. N. Baskara Pandian & another, 1998 SCC

Online Mad 75 and Executive Engineer, T. C. Division, K.S.E.

Boards, Palghat versus J. H. Sharma and another, AIR 1988 Ker. 285 .

He would submit that Order 21 Rule 46 read with Order 21 Rule 46A

of CPC and the provisions which succeed these provisions enact a

scheme which is intended to safeguard the interest of the

garnishee. Any deviation from the mandatory regime will reach grave

injustice to the garnishee as found by the High Court and also

echoed in the judgments relied upon by him. He would further point

out that Order 21 Rule 52 of CPC prov ides for the procedure to be

followed in a case like the present. Order 21 Rule 52 of CPC, reads

as follows: -

ORDER 21 RULE 52:-

52. Attachment of property in custody of

Court or public officer .—Where the

property to be attached is in the custody

of any Court or public officer, the

attachment shall be made by a notice to

such Court or officer, requesting that

such property, and any interest or

dividend becoming payable thereon, may be

held subject to the further orders of the

Court from which the notice is issued:

Provided that, where such property is in

the custody of a Court, any question of

title or priority arising between the

decree-holder and any other person, not

being the judgment-debtor, claiming to be

interested in such property by virtue of

any assignment, attachment or otherwise,

shall be determined by such Court.

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19. He would submit that since the appellant is not pursuing a

case based on the mother (deceased) being a garnishee and if the

further case based on the Court Officer being a garnishee falls to

the ground, the only express provision which must be understood as

giving effect to the residuary clause found in both Section 51 of

CPC and Order 21 Rule 11 must be followed. Section 51 of the CPC,

inter alia, provides as follows: -

51. Powers of Court to enforce execution .—Subject

to such conditions and limitations as may be

prescribed, the Court may, on the application of the

decree-holder, order execution of the decree —

(a) by delivery of any property

specifically decreed;

(b) by attachment and sale or by the sale

without attachment of any property;

(c)by arrest and detention in prison [for

such period not exceeding the period

specified in Section 58, where arrest and

detention is permissible under tha t

section];

(d) by appointing a receiver; or

(e) in such other manner as the nature of

the relief granted may require:

20. In similar vein, we find that when an execution petition

is filed, the applicant is obliged to specify the nature of the

relief which he seeks. Not unnaturally there is replication of the

words 'such other manner as may be needed'. He would still further

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point out that Order 21 Rule 46A of CPC was not available to the

appellant for another formidable reason. Order 21 Rule 46 expressly

is inapplicable in regard to movable property not in the possession

of the judgment debtor where the property is deposited i n or in the

custody of the Court. Therefore, it is contended that if money

fetched in a Court auction can be described as property and it is

deposited in the Court then in view of the express provision of

Order 21 Rule 46, it is not applicable. The scheme of Order 21 Rule

46 followed by Order 21 Rule 46A may not be available and this may

have to be dealt with under Order 21 Rule 52. He would finally

conclude by contending that on the facts there is another obstacle

for the appellant to realise the fruits of the decree. It is

submitted that a perusal of the award by the authority under the

Act would reveal that the judgment debtors have obtained an award

against a third party. It was ordered in the award that the

appellant would be entitled to execute the sai d award in realizing

the amount which was awarded in favour of the appellant in this

case. This has not been accounted for. It is pointed out that the

said process would necessarily have to be undertaken even if this

Court is inclined to grant any relief t o the appellant.

FINDINGS

21. The first question we have to consider is whether the

dismissal of the execution petition filed by the appellant

apparently on the ground of default or withdrawal of the first

execution petition will result in a bar for the filing or the

prosecuting of the Second execution petition. In this regard, in

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fact, we must notice that the learned counsel for the respondent

does not seek to raise any objection as such to the contentions of

the appellant that the second execution appl ication would be

maintainable provided it is within the period of limitation. We

also find merit in the contentions of the appellant that the mere

dismissal of the first application on the ground of default may not

result in the decree holder being preclud ed from filing a fresh

execution petition provided it is within time.

22. This brings us to the aspect of limitation. The plea of

limitation though pressed before the Execution Court was not

pursued by the respondents before the High Court. No doubt, a pure

question of law may be permitted to be raised in an appeal

generated by the grant of special leave under Section 136 of the

Constitution of India. We may only observe that what Section 103 of

the Act contemplates is grant of certificate signed by the

Registrar or the Liquidator. This is to be preceded by the

requirement of words 'shall if not carried out'. In other words,

what Section 103 of the Act appears to contemplate is that after

the adjudication by the Authorities which would include any appeal

carried therefrom, the order passed, inter alia, is to be certified

by the Registrar or the Liquidator. This would give birth to what

is by way of a deeming provision a decree of a Civil Court. In this

case, we may only notice that an award was passed in t he year 1988

and the certificate was issued in the year 1995. As to when the

application was made by the appellant seeking the certificate and

what was the time taken by the Authority to issue a certificate are

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all matters shrouded in mystery. There is a c ase for the appellant,

no doubt, that the apprehension of the learned counsel for the

respondents that if the creditor sleeps over the matter even for a

period beyond time provided for executing a decree and makes an

application with great delay then it wo uld result in a completely

inequitable situation may not rise as the facts speak otherwise. We

do not intend to however in this case go to this question in

greater detail, particularly in view of the fact that it was not

pursued.

23. The next question w hich arises is the effect of the

interplay of Sections 38 and 39 of CPC. They are as follows: -

38. Court by which decree may be executed.—A decree

may be executed either by the Court which passed it,

or by the Court to which it is sent for execution.

39. Transfer of decree .—(1) The Court which passed a

decree may, on the application of the de cree-holder,

send it for execution to another Court [of competent

jurisdiction], —

(a) if the person against whom the decree is

passed actually and voluntarily resides or

carries on business, or personally works

for gain, within the local limits of the

jurisdiction of such other Court, or

(b) if such person has no property within the

local limits of the jurisdiction of the

Court which passed the decree sufficient to

satisfy such decree and has property within

the local limits of the jurisdiction of

such other Court, or

(c) if the decree directs the sale or

delivery of immovable property situate

outside the local limits of the

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jurisdiction of the Court which passed it,

or

(d) if the Court which passed the decree

considers for any other reason, which it

shall record in writing, that the decree

should be executed by such other Court.

(2) The Court which passed a decree may of its own

motion send it for execution to any subordinate court

of competent jurisdiction.

[(3) For the purposes of this section, a Court

shall be deemed to be a court of competent

jurisdiction if, at the time of making the

application for the transfer of decree to it, such

Court would have jurisdiction to try the suit in

which such decree was passed.]

[(4) Nothing in this section shall be deemed to

authorise the Court which passed a decree to execute

such decree against any person or property outside

the local limits of its jurisdiction.]

It is clear that under the scheme of the CPC, if a decree is

passed by a Civil Court, then either th e Court which passed the

decree can execute it or the Court to which the decree is

transferred can execute the decree. Section 39 of the CPC speaks of

the powers of the transferor court. It also provides for the decree

holder applying to the Court which pa ssed the decree. The question,

however, is whether this regime is applicable in the facts of this

case. We have noticed the judgment of this Court rendered no doubt

in the context of the Arbitration and Conciliation Act, 1996 . The

only point which is raise d before us to distinguish the said

judgment by the learned counsel for the respondents is that in view

of the use of words 'decree as defined in clause (2) of Section 2

of CPC', in Section 103 of the Act, the principle may not be

available.

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24. We are of the view that the respondents may not be

justified in seeking to distinguish the judgment of this Court

Sundaram Finance Limited (supra). It cannot be in the region of

doubt that when the Authority passed the award under the Act, it

was a Civil Court. I t is not a Court within the meaning of Section

38 of CPC. If there is no Court, which can be said to have passed

the award in this case, then it is inconceivable as to how it could

be maintained in the same breath that it is indispensable to the

maintaining of the execution proceedings in another Court that the

Court which passed the decree must necessarily transfer the

proceedings to the latter Court. For the effective working of

Section 39 of CPC, in other words, there must be a Court which has

passed a decree. In the context of the CPC, we are of the view that

there is no such Court within the meaning of Section 38 in these

cases. Instead, we have what is essentially arbitration proceedings

and what is passed by the said authority is clothed only with the

effect of a decree and it is enforceable as a decree. No doubt on

the certificate being granted it resulted in a deemed decree. In

such circumstances, we are of the view that there is no merit in

the contention of the respondents. The attempt to distingui sh the

judgment based on the presence of the words 'decree as defined in

clause (2) of Section 2 of CPC' is equally misplaced. This is for

the reason that we would think that the words 'decree as defined in

clause (2) of Section 2 of CPC' as used in Sectio n 103 of the Act

is to reinforce in the concept of a decree with greater clarity and

by way of abundant caution. The mere presence of these words by

itself cannot support the attempt at distinguishing the principle

22

which has been laid down in the decision of Sundaram Finance

Limited (supra) which is that in view of the fact that Sections 38

and 39 of the CPC are not as such applicable, the decree holder may

seek to execute the decree in any Court which otherwise has

jurisdiction. This would mean that the fi nding by the High Court in

this regard is flawed and is liable to be overturned.

25. This brings us to the last of the substantive contentions

which have been debated before this Court. Undoubtedly, Order 21

Rule 46A of CPC is part of the scheme of the provisions relating to

executions and it must be understood with reference to the reliefs

which can be claimed by the decree holder as provided in both

Section 51 and Order 21 Rule 11 of CPC. We have already noticed

Section 51 and we have also noticed Orde r 21 Rule 11. The lawgiver

has elaborated the manner in which each of these sub heads under

which a decree holder may execute a decree. For instance, the

aspect of attachment of various kinds of properties are found to be

separately dealt with in Order 21 of CPC, and the procedure to be

followed has been detailed thereunder. Order 21 Rule 46 apparently

deals with attachment of debt, share and other property but an

important distinguishing feature is that the debt, share and other

property must not be in the possession of the judgment debtor to

attract Order 21 Rule 46. The exception is in regard to ‘such other

property’ which though not in the possession of the judgment

debtor, is property deposited or is in the custody of any Court. In

other words, in regard to such property Order 21 Rule 46 and

therefore Order 21 Rule 46A will not apply. Order 21 Rule 46A of

23

CPC was in fact, inserted by Act 104 of 1976 with effect from

01.02.1997. So are the rest of the provisions which include Order

21 Rule 46B to Order 21 Rule 46I of CPC. The scheme would appear

to be as follows. In the case of debt, share and other property

which is covered by Order 21 Rule 46 the procedure begins with an

attachment. It is to be made by a written order. The order

prohibits the creditor recovering the debt and the debtor from

making payment until further orders of the Court. The copy of the

order so prohibiting the parties is to be affixed on a conspicuous

part of the Court house and another copy is to be sent to the

debtor. The debtor of the judgment debtor is prohibited from

making the payment. He may pay the amount of debt into the Court

and such payment will be a discharge for him as if he has made the

payment to his immediate creditor.

26. Order 21 Rule 46A of CPC, then deals with the notice to be

given to the garnishee. A garnishee is obviously a person who owes

a debt to the judgment debtor . It can be illustrated by an example

i.e. 'A' owes a debt to 'B', 'B' in turns owes a debt to 'C', 'C'

can obtain an order of garnishee against 'A'. 'A' would then be

prohibited from making the payment to 'B'. 'B' would stand

prohibited from receiving the debt from 'A'.

27. It is clear from Order 21 Rule 46A that in the case of

debt which must be understood as a debt spoken of in Order 21 Rule

46 of CPC subject to what we will say immediately hereinafter, it

is insisted upon by the lawgiver that the deb t must have been

24

attached under Order 21 Rule 46. There is a further qualification

as regards deb t. Order 21 Rule 46A excepts, debt secured by a

mortgage or a charge. Once these conditions are fulfilled, then

upon an application being made by the ‘attaching creditor’ a notice

may be issued to the garnishee who in the example we have given, is

'A' calling upon him either to pay the debt or so much of it as

would be sufficient to satisfy the decree and the cost of execution

or show cause as to why he should n ot do so. Under Order 21 Rule

46B, if the garnishee does not pay the amount forthwith or he does

not appear in the case of a show cause, the Court is empowered to

order the garnishee to comply with the terms of the notice. The

Court is empowered to proceed as if there is a decree against the

garnishee. Order 21 Rule 46C reads as follows: -

46-C. Trial of disputed questions .—Where the

garnishee disputes liability, the Court may

order that any issue or question necessary for

the determination of liability shall be tried

as if it were an issue in a suit, and upon the

determination of such issue shall make such

order or orders as it deems fit:

Provided that if the debt in respect of

which the application under Rule 46 -A is made

is in respect of a sum of money beyond the

pecuniary jurisdiction of the Court, the Court

shall send the execution case to the Court of

the District Judge to which the sa id Court is

subordinate, and thereupon the Court of the

District Judge or any other competent Court to

which it may be transferred by the District

Judge shall deal with it in the same manner as

25

if the case had been originally instituted in

that Court.

Therefore, it is clear that the lawgiver has contemplated to

confer invaluable rights on the garnishee in the form of empowering

him to challenge the attachment which is necessarily involved in

the order of garnishee under Order 21 Rule 46A of CPC. If the

attachment is made under Order 21 Rule 46 of CPC, it would be open

to him to question it under Order 21 Rule 58. If it is followed by

an order under Order 21 Rule 46A, it is open to him to dispute his

liability under Order 21 Rule 46C. In this regard, we may notice

the judgment of High Court of Kerala, in Executive Engineer, T. C.

Division, K.S.E. Board, Palghat versus J. H. Sharma and another

reported in AIR 1988 Ker 285 , rendered by a Division Bench and

speaking through U. L. Bhat, J. The High Court, inter alia, held as

follows: -

"5. Attachment of debt in execution of a

decree is dealt with in R. 46 of O. XXI.

Attachment is to be made by written order

prohibiting the creditor from recovering the

debt and the debtor from making payment thereof

until further orders of the court. Sub -r. (3)

of R. 46 states that the debtor so prohibited

may pay the amount of debt into Court. This is

only an enabling provision. There is nothing in

R. 46 which compels the debtor to pay the

amount of debt into court.

6A. It has to be noticed that R. 46 does

26

not contain any provision enabling the

garnishee to raise any objection though it

gives opportunity to the garnishee to subject

himself to the order by making payment into

Court. The next step is provided by R. 46A. He

has to be given notice either to pay the amount

into court or to show cause why he should not

do so. According to R. 46B, where he fails to

pay the amount in Court and also fails to

appear and show cause in answer to the notice,

the court may order him to comply with the

terms of the notice and on such order execution

may issue as though such order were a decree

against him. This is the consequence of his

failure to respond in terms of the notice under

R. 46B. Where he appears and disputes his

liability R. 46C requires that the court should

decide the question as if it were an issue in a

suit and upon the determination of such issue

the court should pass such order as it deems

fit. The Court may uphold the contention raised

by the garnishee or reject his con tention and

pass appropriate orders. Such an order is

appealable under R. 46H. Thus the scheme of the

rules contemplates a specific opportunity being

given to the garnishee to show cause why he

should not pay the amount into Court. If he

raises an objectio n the court has a duty to

consider the objection and pass appropriate

orders. The rules do not require him to raise

an objection suo motu before receiving a show

cause notice under R. 46A. The fact that he did

not suo motu file an objection when the

attachment was effected before judgment does

not take away his right under the above rules

27

to raise an objection.

Equally, we may notice the judgment of the High Court of

Andhra Pradesh reported in (1985) 3 AP LJ 103, Nuthalapati Kotaiah

vs. Executive Officer TTD Office at Guntur , wherein the High Court

held as follows: -

6. For the service of notice or summons, Order

5 C.P.C. provides an elaborate procedure providing

adequate safeguards in effecting notice on the

defendant or the respondent, as the case may be.

Order 21 Rule 46 -A gives power to the Court to

issue notice to the garnishee but couched the

language as ‘may’. When a statute create a duty,

one of the first questions for judicial

consideration, is what is the sanction for its

breach or the mode for compelling the performance

of the duty. This question usually resolves itself

into an enquiry whether the provision is mandatory

or directory viz., whether absolute or,

discretionary. If it is directory, the Court cannot

interfere to compel performance or the act does not

entail with invalidity. But if the act is

mandatory, disobedience entails legal consequences

which may take the shape of a public or private

remedy obtainable in accordance with law. It is,

however, a well recognised canon of construction

that where power is given to a Court or a public

officer for the purpose of being used for the

benefit of persons to be affected upon the

performance of which they are entitled to call for

its exercise, the power ought to be exercised to

effectuate the pu rpose for which it was given.

Though the word ‘may’ appears to be an enabling

word, when the object of the power is to affect a

28

legal right, it must be construed to be mandatory

and has its substitute as ‘shall’.

The learned single Judge of the Madras Hi gh Court in The

Madurai City Municipal Corporation, represented by its

Commissioner, Madurai Vs. N. Baskara Panian & Another, 1998 SCC

Online Mad 75, no doubt, while dealing with the question whether a

fresh attachment is required under Order 21 Rule 46 of CPC when

there is an attachment before judgment took the view that the

earlier attachment would suffice.

28. In this case, there is no attachment of the debt in the

form of the money lying in deposit. The order which is passed is

expressly made under O rder 21 Rule 46A. Certainly, this is not the

manner in which an order could have been passed within the meaning

of Order 21 Rule 46A. There is a definite scheme as already noticed

which is clear from the perusal of Order 21 Rule 46 and by the

subsequent additions to the law by the amendment of the year 1976

which is contained in Order 21 Rule 46A to Order 21 Rule 46I. It

would unerringly point to the provisions being mandatory.

Therefore, the High Court appears to be right in its finding that

the Execution Court should have first attached the debt under Order

21 Rule 46 before proceeding to pass the order under Order 21 Rule

46A of CPC.

29. In this case, we must further bear in mind that the

guarantor (the mother of the Patel Brothers) is not the garnishe e

29

even according to the appellant. In fact, we are unable to think of

as to how the mother of the Patel brothers could be said to owe any

money to her sons. At least nothing has been pressed before us to

indicate how the mother could be the garnishee.

30. The contention, however, raised by the appellant is that

it is not the mother and in fact the appellant was also aware that

the mother was not alive as of the date of the making of the

application and therefore there could not have been any order

against the mother. The argument is that after the auction, the

amount in excess of the judgment debt in the other suit come in, to

the account of the Court and the Officer of the Court therefore

became the debtor or it is the Officer would be the garnishee. We

have our reservations about accepting this line of argument. Order

21 Rule 46 contemplates, inter alia, a debt. It is difficult to

put the Nazir in the position of a debtor. We cannot understand the

relationship between the Nazir in the facts of this cas e and

judgment debtors in the other case is one of debtor and creditor

respectively. Therefore, we would think that the very application

as such may have been flawed.

31. However, in the facts of this case there remains another

aspect. It would appear that the amount for which the property of

the guarantor (mother of the Patel brothers) was sold was

Rs.39,25,000/-. There is order dated 03.02.2007 passed by the

Execution Court. The said order directed the distribution of the

amount fetched in the Court auction in the following manner: -

30

Rs.18,56, 750/- was to be paid to the appellant on account of the

deemed decree in Lavad Suit No.576/1988 and Rs. 6,89,416/ - each was

to be paid to the two Patel brothers in the present case. Further

Rs.6,89,416/- was also to be paid to another brother of the Patel

brothers who was a partner in the firm which was the defendant in

the other suit. The position therefore, which we have before us is

the amount representing the share of the excess amount lies in the

Court deposit i.e. the aggregate of Rs.6,89,416/ - due to Nikhil

Balkrushna Patel and Rs. 6,89,416/- to Ravindra Balkrushna Patel.

We are not certain as to what has happened to the amount of

Rs.6,89,416/- which is earmarked as share of Hemant Balkrus hna

Patel. Hemant Balkrushna Patel is not a party to the present

litigation.

32. Even proceeding on the basis of the flaw which existed in

the application filed under Order 21 Rule 46A and furthermore the

procedure followed by the Court first in not attaching the fund

under Order 21 Rule 46, the question would arise as to whether the

complaint with which we began in the judgment namely the woes of

the decree holder must receive some redress. The award is passed

as we notice in the year 1988 nearly 34 years ago. The amount in

deposit upon the death of the mother of the Patel brothers wo uld

naturally belong to her legal heirs. We posed the question to the

learned counsel for the respondents as to whether apart from the

three Patel brothers whether there is any other legal heir. The

learned counsel for the respondents would submit that the re is no

other legal heir available. We asked the learned counsel for the

31

respondents whether he has a case that the mother has left behind a

Will. It is pointed out to us that there is no Will left behind by

the mother. This will bring the case to Section 15 of the Hindu

Succession Act, 1956, which deals with succession to a Hindu female

who died intestate. The Patel brothers would indeed be the Class -I

heirs being the sons. We must notice in this regard that there is

no case for the respondents that the o rder dated 03.02.2007, which

is passed with them on the party array has been called in question

by the Patel brothers. We, therefore, take it to be a case where

the amount was lying in deposit and it was by the subsequent order

dated 03.02.2007 to be appro priated to the two Patel brothers

involved in this case before us and to the other brother. At this

juncture, we may notice Order 21 Rule 52 again. It is in fact

relied upon by none other than the learned counsel for the

respondents. We would think that in the facts of this case, it

would be appropriate and proper to proceed on the basis that the

procedure under Order 21 Rule 52 ought to have been followed. In

the facts, we would, therefore, feel that it is appropriate and

just to hold as follows: - The second execution petition is

maintainable. The filing of the second execution petition was not

illegal for the reason that there was no order under Section 39 of

CPC. The filing of the application under Order 21 Rule 46A and the

order passed as such by the Ex ecution Court may be flawed.

In the facts of this case, the more appropriate order would

have been one under Order 21 Rule 52 of CPC. The amount is lying

in deposit with the same Court in which the appellant has moved the

second application for execution. We therefore, direct that the

32

order passed by the Execution Court must be treated as an order by

which the attachment has been made under Order 21 Rule 52 of CPC.

By order dated 08.08.2022, this Court had permitted the respondents

to withdraw the amount lying in deposit in excess of Rs.12 lakhs.

It would thus be open to the appellant to proceed against the said

amount, to the exten t of Rs.12 lakhs. The order will be treated as

an order of attachment. We must bear in mind also the fact that

this Court was persuaded to pass an order under which the amount

lying in deposit in excess of Rs.12 lakhs was allowed to be

withdrawn by the res pondents. No doubt, this is on the basis that

even accepting the liability of respondents the amount lying in

excess of Rs. 12 Lakhs should be made available to the respondents.

The Execution Court, namely, 4th Additional Senior Civil Judge

(Ahmedabad Rura l) will therefore proceed with the matter in

accordance with law. However, we make it clear that the

respondents-Patel brothers had an opportunity to raise objections

before the Execution Court and the right which is given under Order

21 Rule 46C is for th e benefit of the garnishee. It is nobody's

case that the respondents -Patel brothers are the garnishees.

33. The Execution Court will however look into the complaint

of the respondents that the appellant has not properly accounted

with reference to the d irections given by the Arbitrator regarding

the adjustment to be done of the amount which would be due to the

respondents under an award obtained by them. We leave it open to

the Execution Court to undertake the said exercise and it is for

the Execution Court to finally decide the exact amount which is to

33

be made available to the appellant.

The appeals are allowed in the above fashion and the impugned

order will stand set aside.

Parties will bear their respective costs.

Pending application(s), if any, stand disposed of.

…………………………………………J.

[K. M. JOSEPH]

…………………………………………J.

[HRISHIKESH ROY]

New Delhi

16th November, 2022