M/S Gkb Hi Tech Lenses Private Limited Vs M/S Sunil… — Company and Corporate | Karnataka HC (2026)

M/S Gkb Hi Tech Lenses Private Limited Vs M/S Sunil… — Company and Corporate | Karnataka HC (2026)

What the court decided

AI extract

Outcome

Petition disposed of: Impugned Order dated 10.03.2020 set aside; decree holder at liberty to take appropriate steps in accordance with law for revival of execution proceedings and for execution of the judgment and decree; deposit made pursuant to the order dated 16.03.2020 to abide by the orders of the Executing Court; Court clarified it had not examined the matter on merits and all rights and contentions of both parties left open.

Issue for consideration

Whether the application for arrest and detention of the judgment debtor followed the procedure under Order XXI Rules 37 to 40 CPC governing arrest and detention. +2 more

Court's answer

Where warrant of arrest is to be issued against a person or entity, a Show Cause Notice under Order XXI Rule 37 CPC is necessary unless the Court is satisfied (per the proviso, by affidavit or otherwise) that the judgment debtor is likely to abscond or leave the local limits of the jurisdiction; satisfaction must be recorded by the Court itself, not merely presumed from the application filed the same day.

Ratio / Principle

A company is a separate legal entity and its Directors cannot be made liable for its debts unless reasons therefor are set out; the Impugned Order named a Director of the judgment debtor company for arrest without recording any such reasons.

Key takeaways

The decree holder set out the name of a Director of the judgment debtor company in the arrest application without indicating how or in what manner that Director was to be made liable for the debt of the Company.ratio¶95
Although the proviso to Order XXI Rule 37 CPC dispenses with notice, the Court passing a same-day warrant had to satisfy itself in terms of the proviso that notice would defeat the object of the execution; the Impugned Order gave no such finding, and therefore could not stand.ratio¶94
The Trial Court's order allowing the arrest application merely recorded issuance of an arrest warrant against a Director of the judgment debtor company as prayed for, without setting out any reasons, and was cryptic.

Detailed headnote1 paragraphs

Karnataka High Court at Bengaluru (Ms. Justice Tara Vitasta Ganju) disposed of a writ petition under Article 227 of the Constitution challenging the order dated 10.03.2020 of the Principal City Civil and Sessions Judge, Bengaluru in Execution No.3567/2019 in O.S.No.5418/2016, by which an arrest warrant was issued the same day against a Director of the judgment-debtor company through the Special Bailiff. Held: a company is a separate legal entity and its Directors cannot be made liable for its debts unless reasons are set out, and none were; under Order XXI Rule 37 CPC a Show Cause Notice, not a warrant, must issue for arrest in execution of a money decree unless the Court itself records satisfaction under the proviso that the judgment debtor is likely to abscond or leave the jurisdiction — no such finding was given, and the order was unreasoned and cryptic. The impugned order was set aside; the decree holder was left free to seek revival of execution; the Rs.10 lakh interim-stay deposit abides the Executing Court's orders; the merits and all contentions remain open.

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 5^TH DAY OF FEBRUARY, 2026

BEFORE

THE HON'BLE MS. JUSTICE TARA VITASTA GANJU

WRIT PETITION NO. 6016 OF 2020 (GM-CPC)

BETWEEN:

M/S. GKB HI-TECH LENSES PRIVATE LIMITED., A COMPANY REGISTERED UNDER THE COMPANIES ACT AND HAVING ITS OFFICE AT, PLOT NO.17A, TIVIM INDUSTRIAL, ESTATE PEDDAM, KARASWADA, MEPUSA GOA-403 507. REPRESENTED BY AUTHORISED REPRESENTATIVE MR. AROKIA NAVEEN.

…PETITIONER

(BY SMT. ANNAPOORNA.S., ADVOCATE)

AND:

M/S. SUNIL MEHTA MARKETING PRIVATE LIMITED, A COMPANY INCORPORATED UNDER THE COMPANIES ACT REPRESENTED BY ITS DIRECTOR SRI. SUNIL MEHTA, SON OF GAUTHAM RAJ MEHTA, AGED ABOUT 45 YEARS, R/AT NO.81A, YESHWANTHAPURA INDUSTRIAL AREA, 2^ND STAGE, BENGALURU-560 022.

…RESPONDENT

(BY SRI. MAINA VERMA., ADVOCATE)

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THIS WRIT PETITION IS FILED UNDER ARTICLE 227 OF THE CONSTITUTION OF INDIA, PRAYING TO SET ASIDE THE ORDER DATED 10.03.2020 PASSED BY THE HON’BLE LVI ADDL. CITY CIVIL AND SESSIONS JUDGE, BENGALURU IN E.P.NO.3567 OF 2019 VIDE ANNX-A. CALL FOR RECORDS IN EXECUTION PETITION NO.3567 OF 2019 BEFORE THE LVI ADDL. CITY CIVIL AND SESSIONS JUDGE, BENGALURU, ETC.

THIS WRIT PETITION, COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE MS. JUSTICE TARA VITASTA GANJU

ORAL ORDER

The Present petition seeks to challenge an order dated 10.03.2020 passed in Execution No.3567/2019 in O.S.No.5418/2016 by the learned Principal City Civil and Sessions Judge, Bengaluru (hereinafter referred to as the “Impugned Order”). By the Impugned Order, an arrest warrant has been issued against the Director of the Judgment Debtor Company through the special Bailiff.

This Court, by its order dated 16.03.2020, had stayed the execution proceedings, subject to deposit of

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₹10.00 lakhs before the Executing Court and the interim order has continued as is since then.

None appears for the respondent/Decree Holder, despite service. Given the pendency of this matter for the last several years, this Court deems it apposite to hear and decide the matter today.

The learned counsel for the petitioner/Judgment Debtor Company has raised three objections:

(i) Firstly, she submits that the application that was filed

by the respondent/Decree Holder was not in accordance with the law. She submits that the power of the Court to order for arrest and detention arises from Order XXI Rules 37 to 40 of the Code of Civil Procedure, 1908, [hereinafter referred to as “CPC”] and that this procedure has not been followed by the learned Trial Court.

(ii) Secondly, it is contended that the learned Trial Court, has, in a mechanical fashion, directed summons to be issued against one of the Directors of the petitioner/

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Judgment Debtor Company, in a manner, as if the Director of the Judgment Debtor Company was the Judgment Debtor himself. She submits that it is settled law that the Company is a separate legal entity.

(iii) Lastly, it is contended that while the decree has been passed and the execution proceedings have been filed against “M/s. GKB Hi Tech Private Ltd.” The application states the name of another Company, “M/s.G.K.B Hi-Tech Lenses Pvt. Ltd”. Reliance is placed on the application which is produced at Annexure ‘D’ to the paper book.

4.1. On a query put by the Court, the learned counsel for the petitioner/Judgment Debtor Company contends that there is no entity by name “M/s.GKB Hi Tech Private Ltd.” She further submits that the contract inter-se the parties being a lease deed, was executed in the name of “M/s. GKB Hi Tech Lenses Private Ltd.”

In addition, the learned counsel for the petitioner/ Judgment Debtor Company fairly submits that the

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execution proceedings have also been closed in the meantime, with liberty granted to the respondent/decree holder to file fresh execution proceedings on the disposal of the present writ petition, by the learned Trial Court, by its order dated 29.04.2025.

A perusal of the record shows that by a judgment and decree dated 05.10.2018, a suit for recovery of possession as well as damages and mesne profits was decreed by the learned Trial Court, directing that the petitioner/Judgment Debtor will vacate and handover the vacant physical possession of the suit schedule property within three months and further directing the petitioner/Judgment Debtor to pay ₹1.50 lakhs as damages per month from the date of termination of tenancy till the date of handing over of possession.

The learned counsel for the petitioner/Judgment Debtor Company has clarified that although an appeal against the Impugned Judgment and decree dated 05.10.2018 has been filed before this Court being

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R.F.A.No.1655/2019, no orders directing stay of the

decree have yet been passed.

8. The learned counsel for the petitioner/Judgment

Debtor Company, however, confirms that the possession has been handed over to the respondent/Decree Holder. Pursuant to the decree, an execution petition was filed

against the petitioner/Judgment Debtor Company praying for the following amounts:

Decree Amount -00
2. Jdr is directed to pay a sum of 92,70,000-00
Rs.1,50,000/- per month as damages
from 01.12.2015 to 30.08.2019 Rs. Ps.
3. Cost awarded in the suit -00
4. Cost of the Appellate Court 00
5. High Court Costs 00
6. Cost of the copies 2,000-00
7. Previous Execution Costs -00
8. Present Execution Costs 10,000-00
9. Advocate fee 20,000-00
10. …………………………………………….
Rs.93,02,000/-
Total
Less amount received with counter Nil
interest thereon at 18% per annum
Balance Rs.93,02,000/-

Subsequently, an application was filed by the petitioner/Judgment Debtor on 10.03.2020. It is apposite to set out the relevant extract of the application below:

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“For the reasons sworn to in the accompanying Affidavit, the Decree holder prays that this Hon'ble Court may be pleased to depute a special balliff to arrest the Judgement debtor who is residing at Mr.Neeraj Gupta, son of Mahendra Gupta, directors, M/s G.K.B Hi-tech Lenses Pvt ltd, Plot No.17A, Tivim Industrial Estate, Peddem, Karaswada, Mapusa, Goa -403507 with the assistance of jurisdictional police , in the interest of justice and equity.”

[Emphasis Supplied]

The affidavit annexed along with the application further sets out that the Judgment Debtor has not complied with the order for deposit of arrears of rent and damages and thus this application has been filed for his arrest and detention. The affidavit annexed along with the application sets out that the Judgment Debtor resides in Goa and has not been appearing before this Court and thus it is stated that since the petitioner/Judgment Debtor is avoiding process, it is necessary to depute a Special Bailiff to recover the amount. Paragraphs 2, 3 and 4 of the affidavit are set out below:

“2. I submit that., I have filed the above execution petition for recovery of arrears of rents and damages. I had filed a original suit in O.S No.5418/2016 against the Judgement debtor and the same was decreed in my favour and the Judgement debtor has not complied the order till this day. After filing of the above petition

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the Judgement debtor has not paid any amount to me till today and going on protracting the matter. Thereafter I have filed an application for issue arrest notice against the Judgement debtor and the said notice has been duly served on the Judgment debtor and even after service of notice he has not complied the same till today .

3. I submit that, the Judgement debtor is presently residing in Goa and he has not been appearing before this Hon'ble court and evading to pay the amount as prayed In the execution petition. Thereafter I have filed an application for issue arrest notice against the Judgement debtor and the said notice has been duly served on the Judgement debtor and even after service of notice he has not complied the same till today. I am not able to recover the amount from the Judgement debtor since he is residing in Goa . In order to execute the warrant and recover my amount from the Judgement debtor is very difficult and he has failed to appear before this Hon'ble Court on the date of hearing and intentionally avoiding to appear before this Hon'ble Court, which clearly shows the intention of the Judgement debtor in this case .

4. I further submit that, the Judgement debtor is politically influence and having the assistance of the rowdy elements support and not allowing me to execute the arrest notice issued by this Hon'ble Court . The Judgement debtor is avoiding the court process by one way or the other and I have to recover amount from him, hence it is just and necessary to depute a special bailiff to execute order passed by this Hon'ble Court and recover my amount in the above case. Hence this application.”

[Emphasis Supplied]

The learned Trial Court, has, by the Impugned Order allowed the application. The order, however, does not set out any reasons and is cryptic, to say the least. It merely

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sets out that the warrant of arrest was issued against one of the Directors of the Judgment Debtor Company as follows:

“Ld. Cnsl for JDR prst. Ld. Cnsl for DHR filed Appln u/s 224 of civil Rules of practice and u/s.151 cpc, also memo for by deposited. Special Bailiff. Bailiff PF paid. IA no.1 heard. IA no.1 allowed. Issue arrest warrant against Director of JDR co., as prayed for through Special Bailiff and call on by 31/3/2020”

[Emphasis Supplied]

As stated above, the application for arrest and detention has been filed naming the Director of the Judgment Debtor Company as a Judgment Debtor himself. It is settled law that a Company is a separate legal entity and its Directors cannot be made liable unless reasons therefor, are set out. The order, however, does not set out any such reasons.

12.1. In addition, it would be necessary to issue a Show Cause Notice in the event that the warrant of arrest is being issued against a person or entity in terms of the provisions of Order XXI, Rule 37 of the CPC, unless the Court is satisfied that the Judgment Debtor is likely to

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abscond or leave the local limits of the jurisdiction. Order

XXI, Rule 37 including its proviso is set out below:

“37. Discretionary power to permit judgment-debtor to show cause against detention in prison .- (1) Notwithstanding anything in these rules, where an application is for the execution of a decree for the payment of money by the arrest and detention in the civil prison of a judgment-debtor who is liable to be arrested in pursuance of the application, the Court shall, instead of issuing a warrant for his arrest, issue a notice calling upon him to appear before the Court on a day to be specified in the notice and show cause why he should not be committed to the civil prison:

Provided that such notice shall not be necessary if the Court is satisfied by affidavit or otherwise, that, with the object or effect of delaying the execution of the decree, the judgment-debtor is likely to abscond or leave the local limits of the jurisdiction of the Court.

(2) Where appearance is not made in obedience to the notice, the Court shall, if the decree-holder so requires, issue a warrant for the arrest of the judgment-debtor.”

[Emphasis supplied]

[13. It cannot be disputed that the Impugned Order has

been passed on the very same day as the application was filed. Although in terms of the proviso to Order XXI, Rule 37 of the CPC, no notice is requisite, however, the Court has to satisfy itself in terms of the proviso that the notice

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would defeat the object of the execution. No such finding has been given in the Impugned Order.

In addition, the respondent/Decree Holder has also set out the name of one of the Directors of the petitioner/Judgment Debtor Company, without setting out as to how and in what manner, he is to be made liable for the debt of the Company.

Given the aforegoing reasons, this Court deems it apposite to pass the following:

(i) The Impugned Order dated 10.03.2020 passed by the learned Principal City Civil and Sessions Judge, Bengaluru in Execution No.3567/2019 in O.S.No.5418/2016, is set aside;

(ii) However, the respondent/Decree Holder is at liberty to take appropriate steps in accordance with law, for revival of his execution proceedings and for taking necessary steps for execution of the judgment and decree passed by the learned Trial Court.

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(iii) The amount deposited by the petitioner/Judgment Debtor Company before the Executing Court, in pursuance of the order dated 16.03.2020, shall abide by the orders of the Executing Court.

(iv) It is clarified that this Court has not examined the matter on merits. All rights and contentions of both parties are left open to be agitated before the appropriate Forum.

This petition is disposed off in the aforegoing terms.

All pending applications stand closed.

Digitally signed by TARA VITASTA GANJU Location: HIGH COURT OF KARNTAKA (TARA VITASTA GANJU) JUDGE

BMV* List No.: 1 Sl No.: 15

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