Allowed

Boddepalli Prasad Rao v. Sri Vijaya Chit Fund (Karimnagar) Private Ltd.

Telangana HC7 Feb 2025CRP/114/2025

Case brief

AI extract

What is this about?

Revision challenging salary attachment orders issued by an executing court for recovery under a chit fund arbitration award. The High Court found the orders would recover more than the awarded amount from each joint debtor and set them aside, remanding the execution petition for fresh orders per relevant provisions.

What did the court decide?

Impugned salary attachment order dated 19.12.2024 set aside; E.P. remanded to executing court for fresh consideration; no costs.

Boddepalli Prasad Rao Vs Sri Vijaya Chit Fund… — Execution and Attachment | Telangana HC (2025)

¶1

HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD

¶2

FRIDAY, THE SEVENTH DAY OF^FEBRUARY

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TWO THOUSAND AND TWENTY^FIVE

¶4

PRESENT

¶5

THE HONOURABLE SRI IUSTICE K.LAKSHMAN

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Civil Revision Petition No.114 of 2025

¶7

Civil revision filed under Article 227 of the Constitution of India, challenging the order dated 03-01.-2025 passed in E.P.No.299 of 2024 in ARB.No.324 of 2023 on the file of the II Additional Junior Civil Judge at Karimnagar.

¶8

Between:

¶9

Boddepalli Prasad Rao, S/o. Lachaiah, aged about 47 years, Occ; Head Constable2594, O/ o. Traffic Police, Near Old Bus Stand, Jagtial, R/o.^{H.No.8-3-419/E,} Ramachendrapur Colony, Bhagathnagar, Karimnagar.

¶10

Marupati Vikram, S/o. Mallaiah, aged about 53 years, Occ: P.C.-2686, O/o.Ramadugu Police StatiorL Ramadugu, Karimnagar, R/o. Flat No.302, K.V.S.Residency, Street No.7/C, N.G.O's, Colony, Bhagathnagar, Karimnagar.

¶11

Boddu Lachaia\ S/o. Lingaiah, aged about 54 years, Occ: Head constable^(AR), O/o.The Police Com:rrissionerate, Head Quarters, Karimnagar, R/o. H.No.469 / 30 / A / 18, Near: Happy Homes, Theegalaguttapally, Karinagar.

¶12

Geekuru Anil Kumar, S/o. Yellaiah, aged about 34 uyears, Occ: Jr. Assistant, O/o. Mandal Praja Parishad Office, Gollapalli,^jagtial, R/o. H.No.9-2-50,^{Bhagathnagar,} Karimnagar.

¶13

Somidi Nataraj, S/o. Rajesharn, aged about 29 years, Occ: Jr. Auditor, O/o.District Marketing Office, Agriculture Marketing Officc, Kharkan agadda, Karimnagar, R/o. H.No.2-1-360, Ambedkamagar, Peddapalli.

¶14

Emmadoju Bhaskar, S/o. Narasimha Swamy, aged about 43 years, Occ:^PC-1692, R/o.H.No.10-2{73/1/2,Pailnavathi Kalyanamandapam, Vidhyanagar, Karimnagar.

¶15

Mogili Madhasudhan, S/o. Kanukaiah, aged about 32 years, Occ: A.M.S., O/oDistrict Agriculture Marketing Committee, Kharkanagadda, Karimnagar,^R/o. H.No-3-1-711, Vavilalapally, Karimnagar.

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... Petitioners/ Appellants.

¶17

AND

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Sri Vijaya Chit Fund (Karimnagar) Private Ltd.,^Regd. Office:8-3-732,^{Bhagathnagar,} Karinagar, rep. by its Branch Foremen, Sri Maddi Sammaiah, S/o. Pochaiah, age 52 years, R/o. Karinagar.

¶19

... Respondent/ Respondent.

¶20

lA NO: 2 OF 2025

¶21

Petition under Section 151 CPC praying that in the circurnstances s$]ted in the affidavit fited in support of the petition, the High Court may be pleased*itay of^all further proceedings including attachment of slary of the petitioner in pursuance of Order dated 03.01.2025 in E.P.No.299 of 2024 in ARB.No.324 of 2023 passed by II Additional Junior^Civil Judge,^{Karinagar, pending disposal of the mainCRP.}

¶22

Counsel for the Petitioners: Sri Rajesh Bathula.

¶23

Counsel for the RespondenL Sri G.Vasantha Rayudu.

¶24

The Court made the following: ORDER

¶25

HoN'BLE SRI JUSTICE K. LAKSHMAN

¶26

CIVIL ITEVIS ION PETITION No.Il4^{OF 2025}

¶27

ORDI.,II:

¶28

Heard Sri Bathula Rajesh, learned counsel^{for the petitioners-} Judgment Delrtors and Sri G.Vasantharayudu,^{leamedcounsel} appearing for rcspondent - Decreeholder.

¶29

This revision is filed under Section^- 1l5^{of the Code of} Civil Procedure, 1908, challenging the^{order dated 19'12'2024 passed} in E.P. No.29\t ol 2024 in ARB. No.324 of^{2023by the learned II} Additional Junior Civil Judge at Karimnagar.

¶30

Respondenl had filed an application^{under Section64 of the} Chit Fund Act. 1982 before the Chit^{Arbitrator/DeputyRegistrarof} Chits at Karinrnagar against the^{petitioners herein lbr recoveryof} Rs.-I.70, 420l- with interest at the rate^{of Rs.18%p.a. fronr the date of} filing of dispute to till the date of realization^{of the said :rmount and} costs.

¶31

The [)eputy Registrar of Chits at Karimnagar.^{has passed an} award dated l(t.(16.2024 holding that^{the petitioners herein are jointly} and severally liable to pay an amount of^{Rs.4,70,420l-with interestat} l8o/o p.a. to the respondent herein.

¶32

¶33

KL,J CRP No I 14 of2025

¶34

Respondent has filed 8.p.No.299 of 2024 in ARB No.324 of 2023 for execution of the aforesaid Award. Leamed II Additional Junior Civil Judge at Karimnagar, has issued impugned salary attachment orders dated 19.12.2025 directing the Disbursing officer of the petitioners/J.Drs.1 to 7 to withhold the sum of Rs.5,70,060/- each from their salaries as per Section _ 60 of CpC after deducting standard deduction plus one thousand and 2/3d of remaining gross salary and shall remit balance l/3.d of salary every month from the date of receipt of the warrant.

¶35

6' challenging the said attachment orders dated 19.12.2024, the petitioners herein filed the present revision.

¶36

Learned counsel for the petitioners has filed salary attachment order in respect of J.Dr.No.4 only. According to him, despite of his best efforts, he could not get salary attachment orders of other respondents.

¶37

Whereas, G.Vasantharayudu, learned counsel fairly submitted that the Executing Court has passed similar attachment orders in respect of the other J.Drs.

¶38

Perusal of the aforesaid salary attachment order dated 1g.12.2024 issued by the Executing Court in respect of the petitioner

¶39

"(*

¶40

¶41

KL,J CRI' No.l l1 of2025

¶42

No.4/J.Dr.No..l would reveal that Executing Court has directed the Disbursing Oft-rcer of the petitioner No.4 - J.Dr.No.4 to rvithhold the amount of Rs.5,70,060/- from his salary. Leamed Executing Court has also passed similar salary attachment orders in respect of other J.Drs. Virtually. as submitted by the learned counsel for the respondent, the Executing Court directed all the Disbursing Officers of the petitioners to deduct and recover an amount of Rs.5,70,060/from each. In fact, the aforesaid execution petition was filed by respondent to execute the award for recovery of Rs.5,70.060/- from the petitioners herein. If the Disbursing Officer withhold the said amount and rernit to the account of the aforesaid Ep, it amounts to recovery of more than the awarded amount. The same is in violation of the procedure laid down under Contract Act, the Chit Fund Act, 1982 and also the principle laid down by this Court in CRp No.2660 of 2024 dated 18.10.2024. The said aspects were not considered by the Executing Court while issuing impugned salary attachment order.

¶43

It is relevant to note that Section - 36 ofthe Arbitration and Conciliation Act, 1996 deals with 'enforcement of award' and the same is relevant for the purpose of considering the fts in the present revisions and it is extracted below: --F

¶44

¶45

¶46

KL,J CRP No.l¹⁴ of2025

¶47

"section 36:-Enforcement. -Where the time lor making an application to set aside^{the arbitralArvard under} section 34 has expired, or such application^havingbeen made, it has been refused, the award^{shall be enforced} under the Code of Civil Procedure,^{1908 (5 of 1908) in the} same manner as ilit were^{a decreeol'the Court.}

¶48

(2) Where an application to set aside the arbitral^{award has} been filed in the Court under^{section 34, the filingof such} an application shall not by^{itselfrender that award} unenforceable, unless the Court^{grantsan order ol stay ol'} the operation of the said arbitral award^{in accordance rvith} the provisions of sub-section^{(3), on a separateapplication} made for that^purpose.

¶49

(3) Upon filing olan application under sub-section^{(2) for} stay ol the operation of the arbitral award,^{the Court may,} subject to such conditions^as it may^{deem ht, grant stay ol} the operation of such award lor^{reasonsto be recordedin} writing:

¶50

Provided that the Court shall.^{whileconsidcring the} apptication for grant of stay in the^{case of an arbitralaward} lor payment of rnoney, have due regard to^{thc provisions} lor grant of stay ol a money decree under the^provisionsol the Code of Civil Procedure, 1908⁽⁵ of^I 908)."

¶51

I 1. It is also relevant to extract Order - XXI,^Rules -^{I 1 (2), 48} and 48A ofthe CPC^{and the same areas under:}

¶52

¶53

KL.J (lRP No.l l4 oi202i

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"XXI^{Rulc f I} @)^{of CPC-Writtenapplication- Save as} otherwise provided by sub-rule(l ), every application for the execution o1- a decree shall be in writing, signed and verified by the applicant or by some other person proved to the satisfaction of the CoLrrt to be acquainted with the facts ofthe case, and shall contain in a tabular form the following particulars, n4mely-

¶55

(a) the number ofthe suit;

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(b) the narnes ofthe parties;

¶57

¶58

(d) whethcr any appeal has been preferred from the decree;

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(e) whether an1,. and (if any) what, payment or other adjustment of the maltcr in controversy has been made between the^panies subseqircntly to the deoree;

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(f) whcther any, and (if an1') what, previous applications have been made lor thc cxecution of the decree, the dates of such applications and their results;

¶61

(g) the anrount *'ith interest (if any) due upon the decree, or other relitf granted thereby. together with particulars ol any oross-decrec. whether pa-ssed before or after the date of the decree sotrght to be cxecutedl

¶62

(h) the amour.rt of the costs (if any) awarded;

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(i) the nanrc of thc pcrson against whom execution of the decree is sought; and

¶64

fi)^{the modcin which the assistanceof the Courtis required} whethcr-

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(i) by the delivery ofany property specifically decreed;

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(ii) by the attachment, or by the attachment and sale, or by the

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sale without attachment, of any property;

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(iii)by the arrest and detention in prison of any person;

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(i)h) tlrc rnpointment ofa receiver:

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(v) otherwise, as the nature of the relief granted may require."

¶71

¶72

¶73

KI-,J CRP No.l l4 of2025

¶74

"Order^{XXI Rule48 of CPC-Attachment of salary or} allowances of servant of the Government or railway company or local authority.- ( 1) Where the properry to be attached is the salary or allowances of a servant of the Govemment or of a scrvant of a railway company or local authority or ofa servant ofa corporation engaged in any trade or industry which is established by a Central, Provincial or State Act, or a Govemment company as defined in section 617 of the Companies Act, 1956 (l of 1956)l the Court, whether the judgmenrdebtor or the disbursing officer is or is not within the local limits of the Court's jurisdiction, may order that the amount shall, subicct to the provisions of section 60, be withheld from such salary or allowances either in one payment or by monttrly instalments as the Court may direct; and upon notice of the order to such officer as the appropriare Govemment may by notification in the Official Gazette appoint in this behalf,-

¶75

(a) where such salary or allowances are to be disbursed within the local limits to which this Code for the time being extends. the olficer or other person whose dury it is to disburse the same shall withhold and remit to the Court the amount due under the order, or the monthly instalments, as thc case may bel

¶76

(b) where such salary or allowances are to be disbursed beyond the said limits, the officer or other person within those limits whose duty it is to instruct the disbursing authority regarding the amount of the salary or allowances to be disbursed shall remit to the Court the amount due under the order, or the monthly instalments, as the case may be. and shall direct the disbursing authority to reduce the

¶77

¶78

KI,.J lll(l' No.I l4 of2025

¶79

¶80

aggregrrte of the amounts from time to time, to be disbursed by the aggregatc of the amounts from time to time remitted to the^('ourt.

¶81

(2) Whcre the attachable proportion of such salary or allowances is alreacll being withheld and remitted to a Court in^pursuance of a prcr' ious and unsatisfied order of attachment, the officer appointcd by the appropriatc Government in this behalf shall forthwith retum the subsequcnl order to the Court issuing it with a full statcment of all the particulars of the existing^attachment.

¶82

(3) Every order made under this rule, unless it is retumed in accordance^q,ith the provisions of sub-rule (2) shall, without further notice or other process, bind the appropriate Governrnent or the-raihvay company or local authority or corporation of Govemnrcnl company, as the case may be, while the^judgmcnt- debtor is within thc local limits to which this Code for the time being extends and while he is beyond those limits, if he is in receipt of any salary or allowances payable out of the Consolitlated Fund of India or the Consolidated Fund of the State or the funds of a railway company or local authority or corporalion or Govemment company in India; and the appropriate Govemment or the railway company or local authorit)' or corporation or Govemment company, as the^case may be, shall be liable for any sum^{paid in contravention} oflhis rule.

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Explanation.-ln this rule, "appropriate Government" means.-

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(i) As respecls any person in the service of the Central Governnrent, or any servant of a railway administration or of a cantonment authority or ofthe port authority of a major port. or

¶85

¶86

KI,,J CRP No.l l4 of202i

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any servant of a corporation engaged in any trade or^industry which is established by a Central Act, or any servant of^a Govemment company in which any pa of the share capital^is hetd by the Central Govemment or by more than one State Govemments or partly by the Central Government and^{partly by} one or more Statc Govemments, the Central Gove-mment;

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(ii) As respects any other servant of the Govemment, or a servant of any other local or other autiority, or any^servant ofa corporation engaged in any trade or industry which^is established by a Provincial or State act, or a servant ofany^other Government oompany, the State Govemment."

¶89

*Order - XXI, RuIe - 48A. Attachment of salary or allowances of private employees.- (1) Where the^{property to be} attached is the salary or allowances of an employee^otherthan an employee to whom rule 48 applies, the Court, where^the disbursing officer of the employee is within the local limits of the Court's^{jurisdiction,} may order than the amount shall, subject to the provision of section 60, be withheld lrom such^{salary or} allowances either in one payment or by monthly instalments as the Court may direct; and upon notice of the order to such disbursing officer, such disbursing officer shall remit to^the court the amount due under the order, or the^monthly instalments. as the case may be .

¶90

(2) Where the attachable portion of such salary or allowances is already being withheld or remitted to the Court in^pursuance of a previous and unsatisfied order of attachment, the disbursing officer shall forthwith retum thc subsequent order to the Court issuing it with a full statement of all the particulars of^the existing attachment.

¶91

¶92

KL,J L-RP No.l l4 of2025

¶93

¶94

(3) Every order made under this rule,^unless it^{is retumed in} accordance with the^{provisionsof sub-rule (2), shall, without} further notice or other^{process, hind the employerwhilethe} j udgment-dcbtors, is within the local limits to which this^Code for the time being extends^{and while he is beyond thoseJimits,} if he is in rcceipt of salary or^{allowancesplyable out of the} funds ol'an employer in any^{part of tndi4 and the employer} shatl be liable for^{any sum paidin contraventionof this rule "}

¶95

It is also relevant to extract Section^{- 7l of the Chit Fund}

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Act, 1982 and thc same is as under:

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"71.^{Moneyhow recovcred.-Every order passed by the} Regisirar or the nominee under^{section68 or section 69 and} every older^passed by the^{StateGovemmentin appealunder} section 70 lbr^payment ofany^{money shall. ifnotcanied out,}

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(a) on a certificate issued by the Registrar'^{be deenredto bea} decree of a Civil Court. and shall^{be executedin thesame} manner as a decree of such^Court,or

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(b) be executed in accordance with the^{provisionsolany lau for} the time being in force for^{therecoveryof amountsasarrearsof} land rcvenue: Provided that^{no applicationfor executionunder} clause^(b1 shall be made aftcr^{the expiryof three years f'romthe} date fixed in the order, and if^no such^{date is fixed, lromthe date} of the order."

¶100

It is also relevant to extract Sections^{- 126, 128 and146 of}

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th{ndian Contract Act, 1872 and the same is as under:

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¶103

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KL.J CRP No.l 14 of2025

¶105

"126. "Contract of guarantee", "surety", "principal debtor" and "creditor".-A "contract ol guarantee" is a contract to perlorm the promise, or dischargc the liability, of a third person in case of his default. The person who gives the guarantee is called thc "surety"; the person in respect of whose delault the grarantee is given is called thc "principal debtor", and the person to whom the guarantee is given is called the "creditor". A guarantee may be either oral or written."

¶106

"128. Surety's liabilitl,.-1-he liability of the surety is coextensive with that of the principal debtor, unless it is otherwise provided b1 lhe contract."

¶107

"146. Co-sureties liable to contribute equally.-Where two or mori pe.ron, are co-sureties for the same debt or duty, either jointly or severally, and whether under the same or different contracts, and whether with or without the knowledge of each other, the co-sureties, in the absence of any contract to the contrary. are liable. as between themselves, to pay each an equal share of the whole debt, or of that part of it which remains unpaid by the principal debtor."

¶108

Thus, the liability of the co-surety is co-extensive with that of principal debtor unless it is otherwise provided by the contract. The said principle was also laid down by a Division Bench of the High Court of Judicature for the States of Telangana and Andhra

¶109

\ /

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¶111

KI,.J (lltP No.l l4 ol'2025

¶112

¶113

Pradesh at Hyderabad in Punyamurthula^{Venkata ViswaSundara} Rao v. M/s. Margadarsi^{Chit Fund Pvt. Ltd.r.}

¶114

The aforesaid relevant^{provisionswouldreveal that for} realization of the amount covered^{under the arbitrationaward,} respondent - decree holder has to^{file an application under Section - 36} of the Arbitratkrn and Conciliation^{Act, 1996,and Order - XXI Rule} I 1 (2) of CPC. Accordingly,^{respondentNo.lhad fitedthe aforesaid} execution petition vide E.P.No.299^{of 2024-}

¶115

Iri l'unyamurthula^{VenkataViswa SundaraRaor,the}

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Division Bench on consideration^{of the contentions advancedby the} parties, framed the following^{two (02) pointsfor consideration:}

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whether the decree holdcr^{has to proceed against all the} judgment debtors, who are guarantors, by claiming proportionate amount dccreed.

¶118

lt. whether the execution Courts^{in whichE.Ps. werefiled} against the^{presentjudgmentdebtors,whoarerevision} petitions herein, have^jurisdiction to^entertainthe execution petitions.

¶119

On consideration of the^{provisions of the Chil Fund Act}

¶120

and the CPC, the Division Bench^{held that the course that has to be}

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'.^{20l? (3) ALT82 (D.8.)}

¶122

¶123

KT,,J CRP No.I l4 of2025

¶124

followed by the decree holder is to make an application to the Registrar for execution, to be forwarded to the proper authority at the option ol the decree holder and the Registrar shalI himself issue the certificate and forward the said application to the Court or revenue authority, as chosen by the decree holder. The decree holder has an option to proceed against either the principal debtor or any of the guarantors or against all of them. Referring to Section - 128 of the Indian Contract Act, the Division Bench held that the liability of a surety is co-extensive with that of the principal debtor unless it is otherwise provided by the contract.

¶125

ln Madamanchi Anill Kumar v. Margadarshi Chit Fund

¶126

Pvt. Limited,' Dirision Bench of the High Court of Andhra Pradesh at Hyderabad considering the said principle laid down by the Division Bench in Punyamurthula Venkata Viswa Sundara Raor, held that the liability of the sureties is joint and several. The Division Bench also negatived the contention raised by the petitioner therein that a Recovery Certificate issued by the Deputy Registrar of Chits cannot be acted upon, as per Rule - 55 of the Andhra Pradesh Chit Fund Rules, 2008 and that an execution is maintainable only if the recovery

¶127

'.^{c.R-p.No.z::sof20l8,decidedon 05.11.2018}

¶128

¶129

KL.J CRP No I 14 of2025

¶130

certificate has been issued by the Registrar of Chits to the competent Civil Court.

¶131

On consideration of the aforesaid provisions and on examination of the facts of the case therein, in Prattipati Srinivasa Rao v. M/s. Shriram City Union Finance Limitedr, this Court held that the decree-holder cannot recover double the awarded amount from the^judgrnent debtors, and it is entitled for the decretal amount and interest as claimed by it from the^judgment debtors.

¶132

As discusied above, the Award was passed for recovery of Rs.4,70,4201- along with interest @ 18% per annum on the principal amount of Rs.4.62,270l-, and the petitioners are^jointly and severally liable to pay the said amount. Respondent has filed the aforesaid execution petition against the petitioners herein to recover the aforesaid amount of Rs.4,70,420l- with interest at l8%o^p.a. each from their salaries. Without considering the aforesaid aspects, more particularly, Sections - 128 and 146 of the provisions of the Indian Contract Ac and Section -71 of the Chit Fund Act and also the principle laid down in Punyamurthula Venkata Viswa Sundara Raor, Madamanchi Anill Kumar2 and Prattipati Srinivasa Rao3,

¶133

'.^{Cor*){*,1".inC *n tuor. t:f &' t 5 t ot2023.decidedon 02.03.2023}

¶134

¶135

t.+

¶136

KL,J CRP No.ll4 of2025

¶137

the Executing Court issued the impugned salary attachment order dated 19.12.2024 inE}. No.299 of 2024. Thus, by virtue of the said salary attachment orders, there would be recovery of more than the awarded amount from the petitioners herein which is impermissible under law. The same is in violation of the procedure laid down under Contract Act, Chit Fund Act, 1872 and also the principle laid down by this Court in CRP No.2660 of 2024 dated 18.10.2024. The said aspects were not considered by the Executing Court while passing the impugned order dated 19.12.2024 in E.P. No.299 of 2024. Therefore, the said order is liable to be set aside

¶138

The present Civil Revision Petition is accordingly allowed. The impugned order dated 19.12.2025 in E.P. No.299 of 2024 in ARB No.324 of 2023 passed by learned II Additional Junior Civil Judge, at Karimnagar, IS set aside. The matter is remanded back to the Executing Court with a direction to consider the said E.P. No.299 of 2024 in ARB No.324 of 2023 afresh and pass appropriate orders in accordance with law including the aforesaid provisions and principle laid down by this Court. In the circumstances of the case, there shall be no order as to costs.

¶139

¶140

NI-.] CRP No I lJ of2025

¶141

As a sequcl thereto, miscellaneous petitions, if an1', pending in this revision shall stand closed.

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//TRUECOPY//

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sd/ -v. KAVITHA ASSISTANT REGISTRAR / ,(\NN OFFICER

¶144

To, 1. The II Additional Junior Civil Judge at Karimnagar' 2. One CC to Sri^{Rajesh Bathula,Advocate} [OPUC] 3. One CC to Sri G.iasantha^{Rayudu, Advocate} [OPUC] 4. Two CD Cop:ies. JCK/kam \n-

HIGHCOURT

DATED:\7/02/2025

ORDER

CRP.No.114 of 2025

Allowing the C.R.P. h'ithout costs.