Allowed

M/s Prem Movies v. Ushakiron Movies Ltd.

Telangana HC22 Aug 2014CRP/2617/2014

Case brief

AI extract

What is this about?

This judgment sets aside a lower court order that directed the petitioners to furnish security and attach property without affording them an opportunity to show cause under Order 38 Rules 5 and 6 CPC. The court restored the interim application and directed the lower court to accept an affidavit undertaking that property would not be disposed of.

What did the court decide?

Order set aside; I.A. restored; lower court directed to accept affidavit of non-disposal and then close I.A.

M/s Prem Movies Vs Ushakiron Movies Ltd. — Specific Performance | Telangana HC (2014)

¶1

HON’BLE SRI JUSTICE C.V. NAGARJUNA REDDY

¶2

C.R.P.No.2617 of 2014

¶3

Date : 22-8-2014

¶4

Between: M/s. Prem Movies and another .. Petitioners And Ushakiron Movies Ltd. and another .. Respondents

¶5

Counsel for petitioners : Sri T. Sharath Counsel for respondents : Sri B. Nalin Kumar

¶6

The Court made the following :

¶7

ORDER:

¶8

This Civil Revision Petition is filed against order dated 8-7-2014 in I.A.No.720 of 2014 in O.S.No.534 of 2012 on the file of the learned VIII Additional District and Sessions Judge, Ranga Reddy District at L.B. Nagar.

¶9

The respondents filed O.S.No.534 of 2012 for recovery of money against the petitioners. In the said suit, they have filed I.A.No.720 of 2014 under Order XXXVIII Rule 5 r/w. Section 151 of the Code of Civil Procedure, 1908 (for short “the Code”) for a direction to the respondents to furnish security for the suit amount and in default the Court may attach the petition schedule property. By order dated 8-72014, the lower Court has allowed the said petition without even notice to the petitioners.

¶10

Sri T. Sharath, learned Counsel for the petitioners, submitted that the lower Court has committed a serious procedural illegality in straight away directing the petitioners to furnish security and disposing of the petition itself. I find merit in this submission.

¶11

Rules 5 and 6 of Order XXXVIII of the Code, which are relevant for the present purpose, read as under : Rule 5 : Where defendant may be called upon to furnish security for production of property:

¶12

(1) Where, at any stage of a suit, the Court is satisfied, by affidavit or otherwise, that the defendant, with intent to obstruct or delay the execution of any

¶13

decree that may be passed against him, -

¶14

(a) is about to dispose of the whole or any part

¶15

of his property, or

¶16

(b) is about to remove the whole or any part of his property from the local limits of the jurisdiction of the Court,

¶17

the Court may direct the defendant, within a time to be fixed by it, either to furnish security, in such sum as may be specified in the order, to produce and place at the disposal of the Court, when required, the said property or the value of the same, or such portion thereof as may be sufficient to satisfy the decree, or to appear and show cause why he should not furnish security.

¶18

(2) The plaintiff shall, unless the Court otherwise directs, specify

¶19

the property required to be attached and the estimated value

¶20

thereof.

¶21

(3) The Court may also in the order direct the

¶22

conditional

¶23

attachment of the whole or any portion of the property so

¶24

specified.

¶25

(4) If an order of attachment is made without complying with the

¶26

provisions of sub-rule (1) of this rule, such attachment shall

¶27

be void.

¶28

Rule 6 : Attachment where cause not shown or security not furnished :

¶29

(1) Where the defendant fails to show cause why he should not furnish security, or fails to furnish the security required, within the time fixed by the Court, the Court may order that the property specified, or such portion thereof as appears sufficient to satisfy any decree which may be passed in the suit, be attached.

¶30

(2) Where the defendant shows such cause or

¶31

furnishes the required security, and the property specified or any portion of it has been attached, the Court shall order the attachment to be withdrawn, or make such other order as it thinks fit.

¶32

A reading of the above reproduced provisions would make it clear that if the Court is satisfied that any of the conditions mentioned in sub-clauses (a) and (b) of Rule 5 exists, it shall direct the defendant within the time to be fixed by it either to furnish security as specified in the order of the Court or to appear and show cause why he should not furnish such security. The Court while making such an order may also direct conditional attachment of the whole or any portion of the property so specified in the order. Where the defendant fails to show cause why he should not furnish security or fails to furnish the required security within the time fixed by the Court, the Court may order attachment of that property. It is implied from sub-rule (3) of Rule 5 of Order XXXVIII of the Code and sub-rule (1) of Rule 6 thereof that in case of failure of the defendant to comply with the two conditions referred to above, the conditional attachment, if any made will mature into an absolute attachment pending the suit and in case, no such conditional attachment was made, the Court, on the expiry of the period stipulated in the notice issued under sub-rule (1) of Rule 5 shall order attachment. In case of conditional attachment, if the defendant complies with the conditions stipulated in sub-rule

¶33

(1) of Rule 5, the Court shall withdraw the attachment. But, in the instant case, the lower Court has not given option to the petitioners to show cause why they shall not be directed to furnish security. Instead, it has straight away allowed the petition and directed the petitioners to furnish security to the extent of the suit amount within 48 hours, failing which it has directed issue of conditional attachment. The lower Court has committed a further serious error in closing the petition. The learned Counsel for the petitioners lamented, and in my view rightly, that by not providing option and on top of it by closing the petition, the lower Court has fore-closed the option of his clients to furnish security in lieu of attachment of the property. He has submitted that his clients are prepared to furnish security for the suit amount and that petitioner No.2 has in fact filed an affidavit in I.A.No.720/2014 undertaking that she will not dispose of the petition schedule property or create any third party interest over the same till disposal of the suit and that as the I.A. was closed, there was no scope for the lower Court to take the said affidavit on record.

¶34

This Court expects the civil courts to pass orders in strict conformity with the provisions of the Code, lest, the litigation such as the present one will be needlessly generated. The courts are bound to make intense application of mind to the relevant provisions and they must

¶35

be in serious contemplation of the ill-effects of the orders that may be passed without following the due procedure prescribed by the statutory provisions.

¶36

Subject to the above observations and for the above mentioned reasons, the order of the lower Court is set-aside. I.A.No.720 of 2014 is restored to file. The lower Court is directed to accept the affidavit filed by petitioner No.2 and thereafter close I.A.No.720 of 2014.

¶37

The Civil Revision Petition is accordingly allowed to the extent indicated above.

¶38

As a sequel to the disposal of the Civil Revision Petition, CRPMP No.3643 of 2014 filed for interim relief is disposed of as infructuous.

¶39

________________________ Justice C.V. Nagarjuna Reddy Date : 22-8-2014 L.R. copies

¶40

M/s Prem Movies v. Ushakiron Movies Ltd.

Case brief

What is this about?

What did the court decide?

M/s Prem Movies v. Ushakiron Movies Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

M/s. Tara Transports Vs National Insurance Co. Ltd.

G.Manoharlal, Vs Syed Mahmood Hussain

M/s Sri Maruthi Industries Vs M/s Sri Gajanand Traders

Bumi Reddy Pranitha Vs Citu, Union Office

Smt. Bumi Reddy Pranitha, Vs Dr.K.v.S.N.Prasad

Bandi Venkata Narsimha Reddy Vs The Joint Collector