Vipul Agarwal Vs Atul Kanodia and Co.

Janardan Sahai, J.@mdashAn award of the Arbitrator-Tribunal under the Arbitration and Conciliation Act, 1996, was given against the applicant on 17.11.1999 for a sum of Rs. 26,18,364 plus interest. Objections of the applicant u/s 34 of the Act against the award were dismissed on 16.1.2003. The appeal against that order was also dismissed on 7.3.2003. The decree was then put into execution. By the impugned order the District Judge, Kanpur Nagar, has ordered for the oral examination of the Petitioner under Order XXI Rule 41, Code of CPC to disclose what assets and means he has to satisfy the decree.

2. I have heard Sri Shashi Nandan, learned Counsel for the applicant and Sri S. K. Gupta, learned Counsel for the Respondents.

3. It is submitted by Sri Shashi Nandan that the execution application filed by the Respondents was defective inasmuch as the details of the properties of the judgment-debtor were not given therein nor the reasons for requiring the arrest and detention of the applicant were disclosed and no affidavit as required under Order XXI Rule 11A, Code of CPC was filed. It appears that originally a warrant of arrest was issued against the applicant but the applicant himself appeared before the executing court and as such the warrant was withdrawn, objections being raised by the applicant that the execution application did not meet the requirement of law, affidavit was fled by the judgment-debtor on 17.4.2003. Sri Shashi Nandan submits hat the grounds why the arrest and detention of the applicant is required have not been disclosed even in the affidavit subsequently filed. Sri Shashi Nandan also placed before me the finding of the executing court that the execution application did not contain the reasons for requiring the arrest of the applicant. Reference has been made by the executing court in its order to the affidavit of the decree-holder and it has been observed with reference to it that the provisions of Order XXI Rule 11A, Code of CPC have been complied with. I have seen the affidavit filed by the Respondent. It is stated therein that the applicant is carrying on business and has the means to pay the money. In view of this averment, it cannot be said that no ground for requiring the arrest, and detention of the judgment-debtor was given in the affidavit.

4. Sri Shashi Nandan submitted that the scheme of the provisions indicates that a finding that the judgment-debtor has the means to pay has to be recorded at the stage before issuance of warrant of arrest or notice. The submission does not appear to be correct. Section 51 CPC provides that execution by detention in the civil prison shall not be ordered excepts after giving opportunity to the judgment-debtor and for reasons to be recorded. The section only requires that opportunity be given and reasons recorded before ordering detention. As yet no detention has been ordered. The warrant of arrest, which has since been withdrawn was issued to secure the presence of the Petitioner in Court. The requirement of Section 51 is met even if reasons are given by the Court at a stage after the examination of the judgment-debtor under Order XXI Rule 41, CPC has been made. The provisions under Order XXI Rule 41 provide for two contingencies. While Sub-rule (1) provides that the judgment-debtor can be called upon to give his statement before the Court as regard to assets owned by him. Sub-rule (2) leaves it open to the Court to require the judgment-debtor if the decree has remained unsatisfied for more than 30 days to file an affidavit indicating therein the assets that he possesses. This Sub-rule (2) has been added by the CPC Amendment Act No. 104 of 1976. The intention of the Legislature made clear by this provision is that if the assets of the judgment-debtor are not clearly known to the decree holder and the decree is not satisfied examination of the judgment-debtor or his affidavit may be required so that the assets can be ascertained. Sri Shashi Nandan relied upon a decision of this Court in Kanhaiya Lal Vs. Mahavir Prasad Jain, , in which it has been held that the burden to prove that the judgment-debtor had assets lies upon the decree holder. The decision is distinguishable. What was held in that case was in the context of an order of detention which had to meet the requirement of Clause (b) of the proviso of Section 5 which postulates a finding that the judgment-debtor has the means to pay. The scope of Order XXI, Rule 41 CPC did not fall for consideration in that case. That apart, that decision was given at a point of time when the provisions under Sub-rule (2) of Order XXI, Rule 41, CPC had not been inserted in the CPC Code. Rule 11A of Order XXI, CPC is a procedural provision meant only to focus the attention of the parties to enable them to place the material upon which the Court can decide whether execution by detention be ordered u/s 51, CPC Code. The stage of Rule 11A is obviously earlier in point of time to the stage of Rules 40 and 41 of Order XXI. If all the material on which the Court is to pass an order for civil detention is to be stated in the application and affidavit contemplated in Rule 11A, the provisions of Rule 41 would be virtually redundant-a view which but for compelling reasons cannot be taken. Interpreted in this light, I am of the view that at the stage of the application and affidavit under Rule 11A, it is enough to state broadly the grounds on which execution by detention is sought. These grounds can be supplemented and supported by material which may become available by examination of the judgment-debtor or from his affidavit under Rule 41 or from the evidence led by the parties under Rule 40. While interpreting these provisions, it has to be borne in mind that after the decree, the judgment-debtor may try to camouflage his assets and properties and it may only be after the curtain is removed by examining him or looking into the books of his business that the assets in his possession become visible. That apart, till date no order of detention has been passed.

5. Lastly, it was submitted relying upon a decision in Radhika Narain v. Chandra Devi AIR 1981 Del 114, that the Court cannot enter into a roaming and fishing enquiry for examining the judgment-debtor under Order XXI Rule 41. This decision is entirely distinguishable. The question involved in that case was of territorial jurisdiction of the Court to which the decree was transferred for execution. It was held that it was necessary for the decree-holder to aver facts, which confer jurisdiction on the transferee court to execute the decree and if such facts were controverted, to embark upon an enquiry on the question of jurisdiction. In the present case, no question of territorial jurisdiction is involved. It may also be taken note of that as yet order for the arrest and detention of the applicant in civil prison has not been passed. It is only at that stage after the examination under Rule 41 or evidence under Rule 40 that reasons are required to be recorded at the stage of ordering execution by detention. The revision has no merit. Dismissed.