Bombay High Court
M/S. La'Builde Associates vs Bipinchandra Narandas Dalal on 6 September, 2013
Author: R.D. Dhanuka
Bench: R.D. Dhanuka
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
CHAMBER SUMMONS NO. 1170 OF 2009
IN
EXECUTION APPLICATION (L) NO. 463 OF 2009
IN
AWARD NO. 8 OF 2004
M/s. LA'Builde Associates )
A Partnership Firm duly registered
ig )
under the provisions of the Indian )
Partnership Act, 1932, carrying on )
the business at Kuber Bhavan, )
Bajaj Road, Vile Parle (W), )
Mumbai - 400 056 ) ..... Applicants
(Orig.Claimants)
VERSUS
Bipinchandra Narandas Dalal )
of Mumbai, an adult Indian )
Inhabitant, residing at 2B, Vaibhav, )
140, S.V.Road, Irla, Mumbai - 400 )
056, through his guardian and )
Manager Shri Anil Shantilal Parekh)
appointed under the Order of the )
High Court at Bombay in Lunancy )
Petition No. 4 of 1986 ) ..... Respondent
(Orig. Respondent)
Mr.K.P.Jain, i/b. Mr.Tushar Goradia & Ms.Nisha Parmar for the Applicants.
Mr.Dipen Merchant, Senior Advocate, a/w. Mr.Dilip Rai, Mr.Vaibhav Bajpai,
i/b. Arvind Rathod & Co. for the Respondent.
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CORAM : R.D. DHANUKA, J.
RESERVED ON : 14th AUGUST, 2013
PRONOUNCED ON : 6TH SEPTEMBER, 2013
JUDGMENT :
By this Chamber Summons, the applicants (judgment creditors) seeks directions against Mr.Anil Shantilal Parekh, guardian and Manager of the respondent appointed by this court to disclose on oath by filing an affidavit as to whether any debts are owing to the respondent and whether respondent had right, title and/or interest on 22 nd April, 2004 or on that date any other property and/or means for satisfying the dues under the award dated 22nd April, 2004 passed by Shri. S.R.Shah, sole arbitrator including the respondent's assets, moveables and immoveable properties, bank accounts, jewellary, shares, securities, other investments, present source of income, details of the respondent's business/employment and other profitable/gainful activities carried out by the respondent and also to disclose all other details required to be disclosed by Form No. 16A of Appendix "E" to the Code of Civil Procedure, 1908 to facilitate the execution of the award dated 22 nd April, 2004 by the applicant. Applicants also seek a direction against said Mr.Anil Shantilal Parekh to produce before this court and furnish to the applicants true copies of all the books of account, statement, income tax returns for last ten years of the respondent to enable the applicants to use those information ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 3 .. chs-1170.2009J.sxw for executing the award dated 22nd April, 2004 and also seek an order of arrest and detention of Mr.Anil Shantilal Parekh in civil prison for three months or for such period this court deem fit.
2. Some of the relevant facts are as under :
(a) By an agreement was executed between the applicants and the respondent on 15th May, 1981, the respondent agreed to sell to the applicants piece of land with tenant thereon situated at Village Anik Chamber, Mumbai described in paragraph (4) of the affidavit in support. Applicants paid Rs.3,20,000/- to the respondent as and by way of earnest money. Dispute arose between the parties and was referred to arbitration.
(b) By an order dated 13th February, 1987 in Lunacy Petition No. 4 of 1986, this court appointed Mr.Anil Shantilal Parekh as guardian and Manager of the person and property of the respondent. On 22nd April, 2004, Shri. S.R. Shah, Former Judge of City Civil Court, Bombay who was appointed as sole arbitrator made an award holding that the applicants could not be granted claim for the specific performance but in lieu of specific performance directed the respondent to pay to the applicants a sum of Rs.2,50,00,000/- as damages with interest at the rate of 6% per ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 4 .. chs-1170.2009J.sxw annum on the said amount from the date of award till payment.
(c) Arbitration petition filed under section 34 of the Arbitration and Conciliation Act, 1996 by the respondent for setting aside the said award came to be rejected. It is the case of the applicants that the application for restoration of the said petition is pending, however, there is no stay of execution of the award.
Respondent filed a Miscellaneous Petition (2 of 1997) in this court which was disposed of by the consent order dated 3 rd October, 1997 whereby the said property which was agreed to be sold to the applicants by the respondent was directed to be sold to one Origin Builders for Rs.80,00,000/- subject to the applicants' right.
(d) On 17th July, 2009, the applicants filed this Chamber Summons for various reliefs. On 8 th February, 2011, applicants moved an application for leave to execute decree. By an order passed by this court, notice filed under Order 21 Rule 22 is made absolute after hearing the respondent. Respondent did not file any appeal against the said order. By an order dated 6 th May, 2011, respondent undertook to file his reply to the Chamber Summons ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 5 .. chs-1170.2009J.sxw within two weeks from the date of the said order. This Court granted ad-interim reliefs in terms of prayer clauses (a) and (b) of the said Chamber Summons. Prayers (a) and (b) of the Chamber Summons are extracted as under :-
"(a) That this Hon'ble Court be pleased to direct Shri. Anil Shantilal Parekh, the guardian and Manager of the Respondent, appointed under the Order of the High Court at Bombay in Lunacy Petition No. 4 of 1986 to file in this Hon'ble Court within 2 weeks of such Order an Affidavit and furnish to the Applicants copy thereof, within the said period, stating on oath as to whether any debts are owing to the Respondent and whether the Respondent had right, title and/or interest as on date of the Order dated 22nd April, 2004 or has as on the date any other property and/or means for satisfying the dues under the Award dated 22nd April, 2004 passed by Shri. S.R. Shah, Sole Arbitrator including the Respondent's assets, movable and immovable properties, Bank Accounts, Jewellery, Shares, Securities, other investments, present source of income, details of the Respondent's business/employment and ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 6 .. chs-1170.2009J.sxw other profitable/gainful activities being carried on by the Respondent and thereby to disclose all other details required to be disclosed by Form No. 16A of Appendix "E"
to the Civil Procedure Code, 1908 to facilitate the execution of the said Award dated 22 nd April, 2004 by the Applicants.
(b) That the said Shri. Anil Shantilal Parekh, the guardian and Manger of the Respondent, appointed under the Order of the High Court at Bombay in Lunacy Petition No. 4 of 1986 be ordered and directed to produce before this Hon'ble Court and furnish to the Applicants within 2 weeks of the Order or such time as may be prescribed by this Hon'ble Court, true copies of all the Books of Account, statement, Income tax returns for last ten years of the Respondent to enable the Applicants to sue those information for executing the said Award dated 22 nd April, 2004."
(e) On 17th May, 2011 Mr.Anil Shantilal Parekh, guardian and Manager of the respondent filed an affidavit in this Chamber ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 7 .. chs-1170.2009J.sxw Summons. It is stated in the affidavit that he has sold the properties of the respondent after obtaining sanction of this court and part of the sale proceeds was utilised for buying the flat which was purchased in the name of the respondent and his daughter and rest of the amount was kept in fixed deposit of bank as per order passed by this court on 3rd August, 1997. It is stated in the affidavit that by an order dated 1st August, 2003 passed in Miscellaneous Petition No. 29 of 2003 in Lunacy Petition No. 4 of 1986, this court granted leave to the said Mr. Anil Shantilal Parekh to withdraw from the fixed deposit, amount spent by him from time to time which included household expenses, expenses for hospital and medicines, security expenses etc. In paragraph 21 of the said affidavit, it is stated that debts of the respondent is at Rs.2,50,000/-
payable as a legal expenses and professional fees to the advocates, solicitors and Chartered Accountants as on 31 st March, 2011. In paragraph 22, it is stated that as on 31 st March, 2011, the respondent is not having any property. In paragraph 23, it is stated that the balance in the bank account of the said respondent with Jammu and Kashmir Bank Ltd., Kalbadevi Branch, Mumbai - 400 002 is at Rs.414/- on the date of filing that affidavit. In paragraphs ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 8 .. chs-1170.2009J.sxw 24 and 25, it is stated that as on 31 st March, 2011, respondent did not have any moveable properties and respondent had Rs.38,087/-.
In paragraph (26), it is stated that respondent does not have any immoveable properties. Since there is no taxable income liable under Income Tax Act, 1961, income tax returns have not been filed with the Income Tax Authorities. Alongwith the said affidavit, balance sheet from the period from 1 st April, 2003 to 31st March, 2011 have been annexed. In paragraph 29 of the said affidavit, it is stated that the flat No. 2B at Vaibhav, 140, S.V.Road, Irla, Mumbai
- 400 056 was owned by the wife of lunatic and she had already disposed of the said flat.
(f) On 20th June, 2011, the said Mr.Anil Shantilal Parekh filed additional affidavit stating that the respondent who is lunatic is not involved in any employment, trade or profession and does not have any annual, monthly or weekly income. Respondent does not own any house or other immoveable property. Respondent owned a residential house at 405, RNA Heights, Jogeshwari -
Vikhroli Link Road, Jogeshwari (E), Mumbai - 400 093 which was sold at the market price by registered agreement to Mr.Krishnanand ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 9 .. chs-1170.2009J.sxw Shaker Marvinkurve in the year 2005 for maintaining and up keeping the respondent. Copy of the said agreement dated 17 th November, 2005 has been annexed. It is stated in the additional affidavit that as on the date of filing of the said affidavit, respondent had Rs.414/- in his bank account No. 2010 with Jammu and Kashmir Bank Ltd., Kalbadevi Branch, Mumbai - 400 002. He did not have any stock and shares, life and endowment policies, house property, other property and other securities. It is stated that there are no debts due to the respondent. It is stated that some of the properties were already sold by the respondent even prior to the declaration of the arbitration award. It is stated that professional fees of Rs.2,50,000/- could not be paid to the chartered accountant and the advocate as there was no fund available in the account of the respondent. It is stated that memo of Arvind Rathod & CO. was for Rs.3,67,000/- out of which Rs.2,25,000/- is still pending. In the said affidavit Mr.Anil S. Parekh also annexed statement of accounts for the period from 1 st April, 2004 till 31st March, 2011. The applicants did not file any rejoinder to both these affidavits.
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(g) The Applicants filed contempt Petition (71 of 2011) in
this court against respondent and Mr. Anil Parekh for not
complying with the order passed by this court on 17 th November, 2011. By an order dated 6th May, 2011 passed by S.C. Dharmadhikari,J. this court observed that it was apparent from the affidavits and also from the contempt petition itself that the compliance was made on 17th May, 2011. It is however, observed that the petitioners in the said contempt petition made allegations that the said affidavit which was filed on 17/5/2011 in compliance with order dated 6/5/2011 was absolutely vague and devoid of any particulars or or contains misleading facts or false statements were made therein, however, the same was not the matter which could be decided in contempt petition. This court accordingly dismissed the said contempt petition with such observations.
3. SUBMISSIONS OF MR. K.P. JAIN, COUNSEL FOR THE APPLICANTS :
(a) Mr. Kishore Jain, learned counsel for the applicants submits that all questions arising between the parties to the suit in which decree was passed or their representatives and relatives ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 11 .. chs-1170.2009J.sxw to the execution be discharged or satisfaction of the decree has to be determined by the Executing Court. It is submitted that the provisions under Order 21 of the Code of Civil Procedure is not substantive law but is a procedural in nature and gives guidelines to the courts to do justice. It is submitted that in view of the ex facie contradictions in the affidavits filed by the Judgment Debtor and in view of the Judgment Debtor not complying with ad interim order passed by this court on 6/5/2011, in terms of prayer clauses (a) and (b), by disclosing various documents, non filing of the rejoinder by the applicant to those two affidavits filed by the Judgment debtor would not be of any consequence. He submits that these two affidavits contain various false and incorrect averments and discloses contradictions on the face of it and thus does not deserve any credence. Mr. Jain submits that the court is entitled to look into as to whether the averments made in the affidavit filed pursuant to the order passed under Order 21 rule 41 are true or not. The court can even suo moto decide that such affidavits are on the face of it false and contradictory. Mr.Jain submit that though this court had directed the Judgment Debtor to produce various documents described in prayer clauses (a) and (b) ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 12 .. chs-1170.2009J.sxw of the Chamber summons, no such documents have been produced by the Judgment Debtor. The Judgment Debtor also did not produce any records directed to be produced by the ad interim order dated 6/5/2011. Mr. Jain submits that the purpose of granting prayer clauses (a) and (b) in favour of the applicant was to find out the assets of the Judgment Debtor to enable the applicants to execute the decree passed in its favour. Two weeks period was granted to the Judgment Debtor to comply with the said directions. This Court did not extend the time to comply with the said ad interim order. The Judgment Debtor did not comply with the said ad interim order dated 6/5/2011. In so far as dismissal of the contempt petition filed by the applicant by this court is concerned, Mr. Jain submits that the question as to whether there are any misleading or false statement made in the said affidavit or not are not decided in the said contempt petition dismissed on 27th April, 2012. It is submitted that though this court has dismissed the contempt petition, the allegations made in those two affidavits which are ex facie false and misleading and contradictory cannot be ignored by this court while deciding the issue under Order 21 rule 41. The question that arises in this ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 13 .. chs-1170.2009J.sxw proceedings are whether the Judgment Debtor has fully disclosed all the assets and properties of the judgment Debtor with details, particulars or not. Mr. Jain submits that merely because affidavits are filed by the Judgment Debtor pursuant to the order passed by this court, such affidavits cannot be accepted at its face value.
Mr. Jain submits that though the contempt petition is dismissed by this court, this court can still see whether the records as directed by this court are produced by the Judgment Debtor or not. It is submitted that in these circumstances, the applicants did not file rejoinder. It is submitted that since the documents as directed by this court are not produced by the respondent, Judgment Creditor could not verify the authenticity of the statements made in the affidavit.
(b) That the intent of legislation under Order 21 rule 41 is to find out assets and properties of the Judgment Debtor to enable the Judgment Creditor to take steps to sell the said properties for recovery of the decretal amount and for ascertaining the correctness of such statements made in the affidavits and the documents produced, if any, cross examination of such witness ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 14 .. chs-1170.2009J.sxw would be must. It is submitted that oral examination permitted under Order 21 rule 41, would be meaningful only by granting opportunity to the Judgment Creditor to cross examine such witnesses. Mr. Jain submits that to prevent any miscarriage of justice, the court has power to undertake exercise of enquiry to find out the assets so that the process of execution would come to its logical end.
(c) Mr. Jain invited my attention to annextures to the affidavit dated 17/5/2011 filed by the Judgment Debtor through Mr. Anil Parekh. It is submitted that Mr. Anil Parekh who has been appointed as Manager and Guardian of the Lunatic is completely in charge of the assets and properties of the respondent. Mr. Jain pointed out from the statement annexed to the affidavit that there is inconsistency in the affidavit. On one hand it is stated that the respondent Judgment Debtor has no property and on the other hand it is disclosed that he has sum of Rs.38,087/- with him.
The Judgment Creditor pointed out that the large amount of interest is claimed to have been paid to Mr. Anil Parekh by the respondent which are adjusted and recovered by him from the ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 15 .. chs-1170.2009J.sxw amounts of the respondent lying with him. Deponent of those two affidavits have recovered large amount of interest without disclosing as to why such interest was paid to him and/or recovered from respondent. It is submitted that Mr. Anil Parekh has wiped of the entire assets by producing such fabricated statement of accounts. Flat worth Rs.66 lacs which was owned by the respondent also has been sold by the said Mr. Anil Parekh.
(d) Mr. Jain placed reliance on the judgment of Punjab and Haryana High Court delivered on 30 th March, 2010 in Civil Revision No. 2000 of 2010 in support of his submission that the court has power under Order 21 Rule 41 of the Code of Civil Procedure to ascertain that the property if any owned by the Judgment Debtors so that the same may be sold for recovery of the decretal amount and cross examination of such witnesses can be permitted. The relevant paragraphs of the said judgment read thus :
"Decree holder filed application under Order 21, Rule 41 of the Code of Civil Procedure ( in short "CPC") requiring the petitioner-Judgment Debtor to state about his properties. The petitioner furnished affidavit Annexure P-1 affirming that the property owned by them as well as the firm had already been auctioned and now, neither the firm nor the partners individually had any moveable or immovable property. Statement of the petitioner's partner Satpal was ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 16 .. chs-1170.2009J.sxw recorded to the same effect. Decree Holder was permitted to cross-examine the Judgment Debtor who admitted that he had been filing income tax returns. His further cross-
examination was deferred with direction to him to produce income tax returns for the last two years. This order is under challenge in the instant revision petition.
I have heard learned counsel for the petitioner and perused the case file.
Learned counsel for the petitioner vehemently contended that Order 21, Rule 41 of the CPC provides for examination of the Judgment Debtor to ascertain his properties but does not provide for cross-examination of the Judgment Debtor for this purpose. Analogy was sought to be drawn from the provision of Order 10, Rule 2 of the CPC. The contention cannot be accepted. Purpose of Order 10, Rule 2 of the CPC is to record statement of either party to clarify the pleadings of the parties to elucidate the matter in controversy. However purpose of Order 21, Rule 41 of the CPC is to ascertain the property if any owned by the Judgment Debtor so that the same may be sold for recovery of the decretal amount. It is not explained how Judgment Debtor/petitioner would be prejudiced if he is cross-examined provided he has nothing to conceal from the Court. If the petitioner actually has no property, he should have nothing to fear from his cross-examination. On the other hand, examination within the purview of Order 21, Rule 41 of the CPC, includes cross-examination because the purpose is to ascertain whether the Judgment Debtor has any property so that the money decree may be satisfied.
For the said purpose, if the Judgment Debtor is cross- examined, there would be nothing illegal in it. On the other hand, if cross-examination is not permitted, the Judgment Debtor may falsely state that he does not own any property."
(e) Mr. Jain distinguished the judgment of the Supreme Court in the case of Municipal Corporation of Greater Bombay ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 17 .. chs-1170.2009J.sxw relied upon by Mr. Merchant, learned senior counsel appearing for the Judgment Debtor on the ground that the Supreme Court did not consider the issue under Order 21 rule 41 of the Code of Civil Procedure in that matter and the issue raised by the parties in this proceedings was not issue before the Supreme Court in that matter.
4. SUBMISSIONS OF MR. MERCHANT, LEARNED SENIOR COUNSEL ON BEHALF OF RESPONDENT :
(a) That the authenticity of the affidavit filed by respondent through his guardian and Manager cannot be dealt with by this court under the provisions of Order 21 Rule 41. It is submitted that the authenticity can be dealt with in perjury proceedings.
There is limited scope of enquiry under order 21 rule 41 as to whether the property of the Judgment Debtor is available to the Judgment Creditor or not for execution of the decree. It is submitted that if the Judgment Debtor finds out that the statements in the affidavit filed by the Judgment Debtor pursuant to the order passed by this court under Order 21 Rule 41 are false ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 18 .. chs-1170.2009J.sxw and misleading, the Judgment Creditor can always file perjury proceedings against the Judgment Debtor for filing such false and misleading affidavit. The Judgment Creditor can apply for amendment if it is found that the other properties are available which were not disclosed by the Judgment Debtor in the said affidavit and file perjury proceedings. The Judgment Creditor has not exercised that remedy. Learned senior counsel then submits that the applicant did not file any rejoinder denying the correctness of the contents of the of the assets and properties disclosed by the Judgment Debtor in the affidavit filed under Order 21 rule 41. The Judgment Creditor cannot cross examine the Judgment Debtor on the contents of the said affidavit filed in response to the order passed by this court. It is submitted that if this court wants to ask any question to the witness to ascertain correctness of the contents of the affidavit filed by the Judgment Debtor, the court can do so under Order 21 rule 41 but such witness cannot be called upon by the Judgment Creditor for cross examination.
(b) Various modes of execution are set out in Order 21 rule 30 for ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 19 .. chs-1170.2009J.sxw money decrees. The application for examination of the Judgment Debtor is not one of such mode of execution. Mr. Merchant submits that various amounts allowed to be withdrawn or the properties of the respondents which were sold by the Guardian and Manager appointed by this court were sold after obtaining sanction of this court. Various amounts which were allowed to be withdrawn were withdrawn for the purpose of maintenance and were spent on various expenditure incurred on the respondent. It is submitted that the question as to whether Mr. Anil Parekh who was appointed as Guardian and Manager of the respondent had committed any breach of the duty as guardian and Manager of the respondent and/or has misused any funds of the lunatic cannot be gone into by this court under Oder 21 rule 41. Such issues can be decided only in the proceedings in which the said Mr. Anil Parikh was appointed as Guardian and Manager of the respondent who is lunatic.
(c) Reliance is placed on the judgment of the Supreme Court in the case of Municipal Corporation of Greater Bombay Vs. Lala Pancham and Others, AIR 1965 SC 1008 and in ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 20 .. chs-1170.2009J.sxw particular para 6 and 15 in support of his submission that the court cannot compel a party to examine any particular witness and it would be beyond competence of the court under Order 21 rule 41 to issue such direction to Judgment Debtor to examine the deponent of the affidavit. Paragraph 6 and 15 of the said judgment reads thus :
"6. The trial court dismissed the suit mainly upon the ground that it was not tenable. An appeal was taken by the plaintiffs to the High Court which was dismissed summarily by Datar J., on August 25, 1961. On the same day the plaintiffs preferred an appeal under the letters patent which went up before a Division Bench consisting of Patel and Palekar JJ. The learned Judges permitted the plaintiffs to amend the plaint overruling the objections of the defendants. In their judgment the learned Judges held that the suit was not barred. Then they proceeded to consider the question of mala fides. According to them the plaintiffs had pleaded mala fides but that they had omitted to give particulars. They also observed that it was true that no evidence was led by the plaintiffs before the trial court and ordinarily they would not have been entitled to lead fresh evidence at that stage, much less so at the stage of the appeal under letters patent. According to them, however, it is not possible to dispose of the case on the material on record, that there are certain documents on record which, if unexplained, "support in a large measure the contention of the plaintiffs that defendants 2, 3 and 4 obtained an order by fraud and also that the order was mala fide." After referring to some of these documents they observed : "Though therefore no evidence is led on the question of mala fides or fraud committed upon them, it prima facie leads to such an inference, and it would not be proper to decide the question without requiring further evidence." This ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 21 .. chs-1170.2009J.sxw observation was followed by another which, we think, is a very unusual one. It is this : "We particularly want the Commissioner and the City Engineer and the defendants to be examined on this question." Eventually, the learned Judges remitted the case to the City Civil Court for recording additional evidence and directed that Court to certify the evidence and its findings by the end of November, 1962. After the grant of special leave to the appellants the proceedings before the City Civil Court have been stayed.
15. We are, therefore, of the view that the High Court was in error in allowing the amendment to the plaint and in remitting the suit to the trial court for a virtual retrial. The High Court, however, did not rest content with this order but further directed "we particularly want the Commissioner and the City Engineer and the defendants to be examined on this question" - the question being the breach of an assurance given to the tenants. In making this direction the High Court may have been actuated by a laudable motive but we think it ought to have borne in mind the limits which the law places upon the powers of the Court in dealing with a case before it. Just as it is not open to a court to compel a party to make a particular kind of pleading or to amend his pleading so also it is beyond its competence to virtually oblige a party to examine any particular witness. No doubt, what the High Court has said is not in terms a peremptory order but the parties could possibly not take the risk of treating it otherwise. While therefore, it is the duty of a court of law not only to do justice but to ensure that justice is done it should bear in mind that it must act according to law, not otherwise."
(d) That the Judgment Debtor has already complied with the order passed by this court under Order 21 rule 41 by filing two affidavits and has disclosed all the assets and properties of the ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 22 .. chs-1170.2009J.sxw respondent. It is submitted that the applicant has not made any application to cross examine deponents of the said two affidavits and thus no order for cross examination of the deponent of the said two affidavits can be passed by this court. Order 21 Rule 41 of the Code of Civil procedure is extracted as under :
"41. Examination of judgment debtor as to his property.-
(1) Where a decree is for the payment of money the decree holder may apply to the court for an Order that--
(a) the judgment debtor, or
(b) where the judgment debtor is a corporation, any officer thereof, or
(c) any other person, be orally examined as to whether any or what debts are owing to the judgment debtor and whether the judgment debtor has any and what other property or means of satisfying the decree; and the court may make an order for the attendance and examination of such judgment debtor, or officer or other person, and for the production of any books or documents.
(2) Where a decree for the payment of money has remained unsatisfied for a period of, thirty years, the court may, on the application of the decree holder and without prejudice to its power under sub-rule (1), by order require the judgment debtor or where the judgment debtor is a corporation, any officer thereof, to make an affidavit stating the particulars of the assets of the judgment debtor.
(3) In case of disobedience of any order made under sub-
rule (2), the court making the order, or any court to which the proceeding is transferred, may direct that the person disobeying the order be detained in the civil prison for a term not exceeding three month unless before the expiry of such terms the court directs his release."
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5. On perusal of prayer clauses (a) and (b) of the ad interim order passed by this court, it is clear that Mr. Anil Parekh, Guardian and Manager of the respondent was directed to state on oath as to whether any debts were owing to respondent and whether he had any right, title or interest as on the date of the order dated 22/4/2004 or has as on the date of the said order any other property and/or means for satisfying the dues under the award dated 22nd April, 2004 including assets movable and immovable property, bank accounts, jewellary, shares, securities, other investments, present source of income, details of the respondent's business/employment and other profitable/gainful activities being carried on by the respondent. Mr. Anil Parikh was also directed to produced before this court true copies of all books of accounts, statement, income tax returns for last ten years of the respondent to enable the applicants to use those information for executing the said award dated 22nd April, 2004. It is thus clear that the purpose of granting such relief in favour of the Judgment Creditor and such direction were issued to the Judgment Debtor and or his guardian and Manager to produce various documents to ascertain the true and correct position of the assets and properties of the Judgment debtor to enable the Judgment Creditor to use those information for executing the decree passed in his favour. In ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 24 .. chs-1170.2009J.sxw my view such direction issued under Order 21 rule 41 are not empty formalities but are issued with specific purpose of collecting true and correct information about the affairs and status of the properties and assets of the Judgment Debtor which can be sold and realized for the purpose of executing the decree obtained by the Judgment Creditor. In my view under order 21 rule 41, not only this court is empowered to know the true and correct details of assets and properties and debts of the Judgment Debtor but in case of any dispute about the authenticity of the averments and contents of the documents annexed to such affidavits and documents to order oral examination of such deponent including cross examination. In my view,Court is empowered to make further enquiry into the authenticity of the averments and contents of the documents under Order 21 rule 41 and the scope of enquiry under order 21 rule 41 is not limited as canvassed by Mr.Merchant, learned senior counsel. If the court is satisfied prima facie that the averments made in the disclosure affidavit does not disclose true and correct affairs and the correct position of the assets/properties and debts of the Judgment debtor, further enquiry into the correctness of such affidavit and contents of documents is permissible under order 21 rule 41. In my view Mr. Merchant, learned senior counsel appearing for the judgment debtor is not correct in his submission that such enquiry has to be ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 25 .. chs-1170.2009J.sxw independently made by the Judgment Creditor and if it is found that the contents of that affidavit were false and misleading, the only remedy of the Judgment Creditor would be to file perjury proceedings against the deponent of such affidavit.
6. On plain reading of Order 21 Rule 41 of the Code of Civil Procedure, it is clear that the judgment Debtor or any other person on an application of the Decree holder may be ordered by court to be orally examined to ascertain whether any debts are owing to the Judgment debtor and whether said Judgment Debor has any property or means for satisfying the decree and the court is empowered to even direct such Judgment debtor or other person for production of any books or documents. It is clear that the purpose of such oral examination is to ascertain the property owned by the Judgment Debtor so that the same may be sold for recovery of decretal amount.
7. On perusal of the two affidavits field by Mr. Anil S. Parekh, the Guardian and Manager of the respondent, I am of the prima facie view that various amounts are claimed to have been recovered and/or appropriated by the deponent of those two affidavits from the properties of the respondent Judgment Debtor to himself towards payment of interest and other ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 26 .. chs-1170.2009J.sxw expenditure. The deponent of those two affidavits appears to be in exclusive control of all the assets and properties of the Judgment Debtor at least since his appointment as Guardian and Manager of the respondent who is lunatic.
On perusal of the affidavits, it is also clear that all the documents directed to be produced by this court by ad interim order have not been produced by the respondent acting through as Guardian and Manager along with details.
Various expenses are claimed and are alleged to have been paid by the respondent through his Guardian and Manager and the balance if any of the respondent is shown at negligible amount. Considering the nature of affidavit filed by the respondent through his guardian and Manager, in my view, such affidavit cannot be accepted at its face value and cannot be considered as conclusive as far as debts, properties and assets of the Judgment Debtor are concerned. In my view the Judgment Creditor is entitled to challenge such expenditure claimed by the Judgment Debtor from the assets and properties of the Judgment debtor. If it is found ultimately that the Judgment debtor has filed false and misleading affidavit and has not given true and correct position of the assets and debts of the Judgment Debtor and assets and properties of the Judgment Debtor are available then the Judgment Creditor would be able to recover amounts in execution of the decree in his favour. If it is found that the Judgment Debtor has to recover any amount lying in the ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 27 .. chs-1170.2009J.sxw hands of third party, the Judgment Creditor can always apply for attachment of those properties and or recoverables lying with the third party by filing garnishee proceedings.
8. In my view, merely because affidavit in rejoinder is not filed by the Judgment Creditor to the affidavits filed by the Judgment Debtor, this court cannot come to the conclusion that what is stated in the affidavit filed in response to the order passed by this court, under Order 21 Rule 41, is deemed to have been proved and no further enquiry about the correctness thereof would be necessary. Punjab & Haryana High Court in the case of M/s.
Baru Ram Banarsi Dass (supra) has considered similar situation and has held that the purpose of order 21 rule 41 of the Code of Civil Procedure is to ascertain property if any owned by the Judgment Debtor so that the same may be sold for recovery of the decretal amount. It is held that no prejudice would be caused to the Judgment Debtor if he is cross examined provided he has nothing to conceal from the court and if the Judgment debtor actually does not have any property, he should have nothing to fear from his cross examination. Punjab & Haryana High Court has held that the examination within the purview of Order 21 Rule 41 of the Code of Civil Procedure, includes cross examination because the purpose is to ascertain whether the ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 28 .. chs-1170.2009J.sxw Judgment Debtor has any property so that the money decree can be satisfied. It is held that if cross examination is not permitted the Judgment Debtor may falsely state that he does not own any property and if the Judgment Debtor is cross examined, there would be nothing illegal therein. I am in agreement with the views expressed by the Punjab and Haryana High Court. In my view, the principle laid down by the Punjab & Haryana High Court in the case of M/s. Baru Ram Banarsi Dass (supra) are applicable to the facts of this case also and the principle laid down therein can be extended to this case.
9. In the case of Republic of Costa Rica Vs. Strousberg Vol. 16 Chancery Division Page 8, similar facts and provision which is in para materia with Order 21 Rule 41 has been construed and similar question raised in this proceeding was subject matter of the said proceedings. It is held that the examination of the witness is not only intended to be an examination, but to be a cross-examination, and that of the severest kind. It is held that all the questions asked were fair questions in that sense, and fairly pertinent and properly asked with a view of ascertaining from the Defendant what debts were owing to him, and that they ought all to have been answered. It is further held that he ought to answer all similar questions fairly directed to that end, and that the order asked ought to have been made by the Vice-
::: Downloaded on - 27/11/2013 20:16:31 :::hvn .. 29 .. chs-1170.2009J.sxw Chancellor. He must answer all questions fairly directed to ascertain from him what amount of debts is due, from whom due, and to give all necessary particulars to enable the Plaintiffs to recover under a garnishee order. In my view the principles laid down in Chancery Division on construction of the provisions, which are in para materia with Order 21 Rule 41 of the Code of Civil Procedure are applicable to the facts of this case and can be extended to the matter in hand. I am in agreement with the views expressed by the Chancery Division. Relevant paragraph of the said judgment in the case of Republic of Costa Rica read thus :
"The Republic of Costa Rica obtained judgment against Mr. Strousberg . Rule 1 of Order XLV. of the Rules of Court, 1875 , is this:--"Where a judgment is for the recovery by or payment to any person of money, the party entitled to enforce it may apply to the Court or a Judge for an order that the judgment debtor be orally examined as to whether any and what debts are owing to him, before an officer of the Court, or such other person as the Court or a Judge shall appoint; and the Court or Judge may make an order for the examination of such judgment debtor, and for the production of any books or documents." It appears that this clause is copied in substance from the 60th section of the Common Law Procedure Act, 1854 , which enacts that, "It shall be lawful for any creditor who has obtained a judgment in any of the superior Courts to apply to the Court or a Judge for a rule or order that the judgment debtor shall be orally examined as to any and what debts are owing to him before a Master of the Court, or such other person as the Court or Judge shall appoint; and the Court or Judge may make such rule or order for the examination of such judgment debtor, and for the production of any books or documents. ..." Now, considering that that is a power which has been in force ever since 1854, it is certainly somewhat remarkable that no authority can be produced on ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 30 .. chs-1170.2009J.sxw either side as to how that examination ought to be conducted, or to what extent it can be justifiably carried. But the Plaintiffs in this case, availing themselves of that power, have obtained an order for the examination of the Defendant. Now the only subject on which he was to be examined was, what debts are owing to him. It appears that Mr. Kekewich conducted this examination; and it does appear to me that this is a power which is to be strictly construed. The object of this examination evidently is for the purpose of ascertaining from the judgment debtor what debts are owing to him, in order that the judgment creditor may attach those debts. It is in the nature of a discovery; and it appears to me very much like thRe discovery of documents where a defendant is asked what documents he has, and he sets out what documents he has: but you cannot cross-
examine him upon that. You must take his statement to be correct. Now here, where you are to cross-examine him as to what debts are owing to him, I think you may go to this extent:
you may ask him, "What debts are owing to you?" and if he gives you the answer you may very well say, "Does not your banker owe you any balance?" "Is there not a Rbalance due to you on a contract in which you are engaged?"--and he is certainly bound to answer; but it does appear unquestionable that Mr. Kekewich here thought himself at liberty to go beyond the mere object of asking what debts are owing, because he asked him, "Are you carrying on any business at the present time?" I do not think, under the circumstances of the case, it was necessary to ask him whether he was carrying on business at the present time. Then he was asked, "Are any debts owing to you?" Then he was asked, "Are you a contractor? Is any money now due to you on any contract now completed?" He said, "I do not understand the question. No money is now due to me under any contract except the contract above referred to." Then he is asked, "Have you any contracts pending?" Then he says, "I shall answer no questions except as to what debts are owing to me." Then there is this, "Are you not a contractor by profession?" Now why should he be asked whether he is a contractor by profession? They knew perfectly well what he was; they knew perfectly well all about him, and all they wanted to know was what debts were owing to him, in order that they might *11 exercise the power of issuing an attachment against those debts. I think, therefore, the ::: Downloaded on - 27/11/2013 20:16:31 ::: hvn .. 31 .. chs-1170.2009J.sxw examination was carried beyond the object authorized by the rule, but I am also very much impressed by the opinion that Mr. Strousberg , being advised by counsel, refused to answer questions which, I think, he might very well have answered. However, my construction of the Act is that they were not at liberty to make a general examination. With every respect for Mr. Kekewich , I think he went there rather in the spirit of a cross-examiner than as a mere examiner as to what debts were owing to Mr. Strousberg . The object of the rule is simply to ascertain whether a debtor has any debts owing to him in order that they may be attached. To that question, in my opinion, the questions ought to have been confined. He might have been asked, "What debts are owing to you?" And he might have said, " A. B. owes me so much money, and C. D. owes me so much money." If the examining counsel were not satisfied with that, he might have asked, "Have you any balance at your bankers?"
and take his answer, "Yes or no." Therefore I think the examination went beyond its just bounds. At the same time, I think the answers were more curt than they might have been. Therefore, upon the whole, I cannot make any order that Mr. Strousberg should attend to answer these general questions which were put to him. He must attend for the purpose of answering the simple question authorized by the rule--what debts are owing to him--and no others. I think there has been over-zeal on the part of the Plaintiffs. I think they have been carrying the matter a little too far, and I rather had an inclination to dismiss their motion with costs; but on the whole, considering all the circumstances, I think it will be better to dismiss it without costs.
The Plaintiffs appealed from this decision. The appeal was heard on the 4th of November.
Glasse , Q.C., Kekewich , Q.C., and H. A. Giffard , for the Appellants:--
If the Respondent is entitled to restrict the examination to the simple question as to whether any debts are due to him, the order will be a nullity. We submit he is bound to answer all questions relevant to the subject-matter which will tend to give the Plaintiffs the discovery they seek, otherwise what is the use of requiring him to attend with and produce books, vouchers, ::: Downloaded on - 27/11/2013 20:16:32 ::: hvn .. 32 .. chs-1170.2009J.sxw documents, and the like?
Higgins , Q.G., and Medd , for the Respondent:--
The order is a very stringent one, and must be construed strictly.
The Respondent has complied with the order made against him. The questions put were quite irrelevant to the subject-matter. JESSEL, M.R.:--
I think this appeal must succeed. As I understand the rule, the examination is to be "as to whether any and what debts are owing to the judgment debtor." That means exactly the same thing as "touching the debts owing the judgment debtor," which was the form of the order that used to be issued under sect. 60 of the Common Law Procedure Act, 1854 . Any question, therefore, fairly pertinent to the subject-matter of the inquiry, which means put with a view to ascertain so far as possible, by discovery from a reluctant defendant, what debts are owing to him, ought to be answered by the defendant. I am of opinion that all the questions asked were fair questions in that sense, and fairly pertinent and properly asked with a view of ascertaining from the Defendant what debts were oRwing to him, and that they ought all to have been answered. I am further of opinion that he ought to answer all similar questions fairly directed to that end, and that the order asked ought to have been made by the Vice-Chancellor. He must answer all questions fairly directed to ascertain from him what amount of debts is due, from whom due, and to give all necessary particulars to enable the Plaintiffs to recover under a garnishee order. I think therefore that the order asked for below should be made now, and that the Respondent should pay the costs of the appeal. JAMES, L.J.:--
I am of the same opinion. The examination is not only intended to be an examination, but to be a cross-examination, and that of the severest kind."
10. In my view, the right to examine witness includes right to cross examine and no prejudice would be caused to the Judgment Debtor if the ::: Downloaded on - 27/11/2013 20:16:32 ::: hvn .. 33 .. chs-1170.2009J.sxw Judgment Creditor is allowed to cross examine the Judgment Debtor with a view to ascertain the true and correct position of the property, assets and dues of the Judgment Debtor so that the Judgment Creditor can apply for further directions to this court so as to execute the decree.
11. I am not inclined to accept the submission of Mr. Merchant that the Guardian and Manager appointed by this court in Guardianship petition, is liable to submit accounts of lunatic only in such guardianship proceedings and action if any against such guardian and Manger can be taken only in those proceedings. In my view, the guardian and Manager not only represents the judgment debtor but has filed affidavit on his behalf and is answerable to this court in this proceedings and is liable to be subjected to cross examination.
12. As far as judgment of the Supreme Court in the case of Municipal Corporation of Greater Mumbai Vs. Lala Pancham and others, AIR 1965 SCC 1008 relied upon by Mr. Merchant, learned senor counsel appearing for the Judgment Debtor is concerned, on perusal of the judgment, it is clear that the Supreme Court was considering the petition impugning the amendment of the plaint allowed by the High Court and remitting the suit to the trial court and while doing so, the High Court had directed that ::: Downloaded on - 27/11/2013 20:16:32 ::: hvn .. 34 .. chs-1170.2009J.sxw the Commissioner and City Engineer be examined on the question of breach of assurance given to the tenants. Considering these facts, the Supreme Court has held that just as it is not open to a court to compel a party to make a particular kind of pleading or to amend his pleading so also it is beyond its competence to virtually oblige a party to examine any particular witness. It is held that it is duty of court of law not only to do justice but to ensure that when justice is done, it should bear in mind that it must act only according to law, not otherwise. In this mater, the Judgment Creditor seeks to cross examine judgment debtor acting through guardian and Manager who has filed affidavit pursuant to the order passed by this court under Order 21 rule 41 of C.P.C. 1908 disclosing assets, properties and debts of the Judgment Debtor. In my view Order 21 Rule 41 permits examination of the judgment debtor which includes cross examination of the judgment debtor. Reliance thus placed by the learned senior counsel on the judgment of the Supreme Court in the case of Municipal Corporation of Greater Bombay Vs. Lala Pancham is totally misplaced and the said judgment does not assist the judgment debtor.
13. The Supreme Court in the case of Saiyad Mohammad Baker El-
Edross Vs. Abdulhabibn Hasan Arab and Ors. 1998(2) G.L.R. 1781 has ::: Downloaded on - 27/11/2013 20:16:32 ::: hvn .. 35 .. chs-1170.2009J.sxw held that the procedural law is always in aid of justice and not in contradiction or to defeat the very object which is sought to be achieved. A procedural law is always subservient to the substantive law. Nothing can be given by a procedural law what is not sought to be given by a substantive law and nothing can be taken away by the procedural law what is given by the substantive law. In my view, procedure under Order 21, Rule 41 is in aid of execution of decree with specific purpose to ascertain the true and correct position of assets and liabilities of the judgment Debtor.
14. I am therefore, of the view that the Judgment Creditor is entitled to cross examine the Judgment Debtor on the contents of the affidavit filed by the Judgment Debtor under Order 21 Rule 41 of the Code of Civil Procedure and also on the authenticity of the contents of the documents relied upon.
Parties are at liberty to lead oral evidence before the Commissioner for taking Accounts of this court.
16. The question as to whether respondent through Anil Parekh, Guardian and Manager of the respondent has complied with ad interim order passed by this court or whether any further action should be taken against the said Mr. Anil Parekh for warrant of arrest or not, the same can be decided only after ::: Downloaded on - 27/11/2013 20:16:32 ::: hvn .. 36 .. chs-1170.2009J.sxw oral evidence of the respondent or his guardian and Manager is recorded as directed by this court. After oral evidence is recorded, plaintiff would be at liberty to apply for relief in terms of prayer clauses (c ) to (g) of the Chamber summons. Liberty is granted to the parties to apply for placing the Chamber Summons on board after evidence is recorded before the Commissioner for Taking Accounts. Commissioner to act on the copy of this order duly authenticated by the Associate of this Court.
Oral request of the learned counsel appearing for the respondent for stay of operation of this order is rejected.
(R.D.DHANUKA, J.) ::: Downloaded on - 27/11/2013 20:16:32 :::