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Report No. 14

31. Recommendation of the Rankin Committee.-

In this connection in our view a recommendation made by the Rankin Committee merits acceptance an application for execution is often returned for the correction of the amount due on the ground that it is inaccurate. The officer returning it does not say why or how it is inaccurate or what the correct amount is with the result that the petition passes from the vakil to the court and from the court back to the vakil more than once. It seems to us either that it should be made the duty of the court to say in the return what the correct amount is or that an order should be passed subject to objections by the petitioner that execution do issue for what the court fixes as the correct amount.1" We recommend an amendment of rule 17 so as to give effect to the above recommendation made by the Committee.

1. Report, p. 384, para. 12.

32. Notice to judgment-debtor.-

Rule 22 speaks of the cases in which notice must be given to the judgment-debtor to show cause why the decree should not be executed against him. It will be convenient at this stage to discuss the general question of notice in execution proceedings. It has been said that the procedure in respect of execution should as far as possible be brought into line with that of the trial of an original suit and only a preliminary intimation of the execution petition should be given to the judgment-debtor, after which the petition should be adjourned to definite dates for further steps such as order for attachment, settling or proclamation, sale and the like. The judgment-debtor must personally take notice of such steps by being present in court or otherwise.

Theory of giving notice.- We may begin with an examination of the different stages in execution of which notice is required to be given to the judgment-debtor. The underlying theory of the rules relating to the execution procedure is that ordinarily a person against whom a decree is passed is expected to know his liability to the decree-holder and of the various processes by which the latter can realise the decretal claim and therefore it is unnecessary to give him any notice of execution. Taking the initial intimation of the execution application itself there are only three cases in which notice is required to be given to the judgment debtor to show cause why the decree should not be executed.

Such notice has to be given when an application is made (1) more than one year after the date of the decree or (2) against the legal representative of a party [Order XXI, rule 221, (3)1 if the application is for the execution of a money decree by the arrest and detention in civil prison of a judgment-debtor (Order XXI, rule 37). The object of these notices is to give a judgment-debtor an opportunity of showing cause why execution should not issue.

So far as notice under rule 22 is concerned, the rule itself lays down two exceptions under which notice is dispensed with: firstly, when the application is made after the expiry of one year from the date of decree but within one year from the last order made on any previous application for execution against the same person, or, if the application is made against the legal representative, if upon a previous application for execution against the same person, the court has ordered execution to issue against him. Secondly, the court can dispense with notice if, for reasons to be recorded, it considers that such notice would cause unreasonable delay or defeat the ends of justice.

Excepting in these cases, notice is obligatory under sub-rule (1) and omission to give it or omission to record the reasons for dispensing with the notice under sub-rule (1) renders all subsequent execution proceedings void. It has been held in a number of decisions that notice under sub-rule (1) affects the very foundation of jurisdiction and if execution is issued without such notice and property belonging to the-judgment debtor is sold, the sale is a nullity.

33. Recommended.-

It has been suggested that no notice need be given to a judgment-debtor against whom a decree has been passed even if the execution petition is made more than one year after the date of the decree since he is not likely to forget the decree obtained against him. Accordingly, it has been proposed to omit clause (a) of sub-rule (1). A modified form of this proposal is to extend the period prescribed in clause (a) to two or three years. The High Court of Allahabad has omitted clause (a) altogether whereas the High Courts of Bombay, Madras and the Punjab have raised the period to two years and the High Courts of Kerala and Nagpur to three years.

The rigour of the law as to the consequences of an omission to give notice, can be mitigated by an amendment of the rule providing that omission to issue the notice required under sub-rule (1) or to record reasons in a case where notice is dispensed with under sub-rule (2) shall not affect the jurisdiction of the court executing the decree or invalidate any subsequent proceedings unless the judgment-debtor has sustained substantial injury by reason of such omission.

34. Recommendation.-

We do not consider the omission of clause (a) of sub-rule (1) necessary. If our recommendation that it should not be necessary for the decree-holder to be compelled to keep the decree alive by applying for execution every three years is accepted, it would be open to a decree-holder to apply for execution several years after the decree is passed. In such cases we think that having regard to the long interval between the date of the decree and the application, it is fair that the judgment-debtor should have an opportunity of showing cause against the issue of execution. We therefore recommend that clause (a) be amended by substituting 'three years' for 'one year' and that the following new sub-rule may be added to rule 22:

"(3). Omission to issue a notice under sub-rule (1) or to record reasons in a case where notice is dispensed with under sub-rule (2) shall not affect the jurisdiction of the court executing the decree or render invalid the subsequent proceedings in execution unless the judgment debtor has sustained substantial injury by reason of such omission."

35. Notice before arrest.-

Notice is also required to be given to the judgment-debtor of the initiation of execution proceedings against him when the decree is sought to be executed by his arrest and detention in civil prison. Under rule 37 it is obligatory on the court, before issuing a warrant of arrest, to issue a notice to the judgment-debtor to appear and show cause why he should not be committed to the civil prison. The court may, however, dispense with notice if it is satisfied that with the object or effect of delaying the execution of the decree the judgment-debtor is likely to abscond or leave the local limits of the court's jurisdiction. Before the amendment of the Code by Act )0(I of 1936 it was in the discretion of the court either to issue a warrant without issuing notice or to give a notice in the first instance. By the amendment of 1936 the word "shall" has been substituted for the word "may" in sub-rule (1).

36. Notice to be discretionary.-

Execution by arrest and detention is often very effective as a quick way of realization of money payable under a decree and the view is largely held that the obligation to issue a notice in the first instance defeats the very purpose of this mode of execution by enabling a judgment-debtor to abscond before the issue of the arrest warrant. The Civil Justice Committee thought that no notice was necessary before issuing an arrest warrant. We are, however, in agreement with the view of the Uttar Pradesh Judicial Reforms Committee that under rule 37, it should be left to the discretion of the court whether to issue it notice or not, because "if execution by arrest has to continue and is to be of any value, it should not be compulsory for the court to issue notice in every case.1" We recommend, therefore, that the law should be restored to what it was before 1936 by substituting the word "may" for the word "shall" in sub-rule (1).

1. Uttar Pradesh Judicial Reforms Committee Report, p. 43.

37. Notice under rule 84 (Necessary).-

A notice in the first instance is also necessary when the decree is for the execution of a document or for the endorsement of a negotiable instrument. In such a case if the judgment-debtor neglects or refuses to obey the decree, the decree-holder can prepare a draft of the document or endorsement in accordance with the terms of the decree and deliver the same to the court for execution. Before the court executes the documents, the draft has to be served on the judgment-debtor with a notice requiring his objections to be made within a time to be fixed by the court. Such a notice is, in our view, essential and cannot be dispensed with.

38. Notice under rule 66 (To be dispensed with).-

We have so far considered cases in which notice is given to the judgment-debtor of the initiation of the execution proceedings. As to notice at subsequent stages of execution we need consider only the stage at which immovable property is ordered to be sold in execution of a decree. The order to sell the property is made under rule 64 which does not require any notice to be given to the judgment-debtor. But under Order XXI, rule 66 notice has to be given to him for settling the terms of the proclamation of sale after an order for sale has been made under rule 64. We suggest that this notice may be dispensed with and at the time when the prohibitory order is issued under rule 54, the judgment-debtor be required instead to attend court on a given date to take notice of all further steps as in the case of a suit.

39. Stay of execution.-

The execution of a decree may be stayed either under Order XXI, rule 26 or by an injunction under Order XXXIX, rule 1 or under Order XLI, rule 5. Under Order XXI, rule 26 execution can be stayed by a court to which a decree is "sent for execution on sufficient cause being shown to enable a judgment-debtor to bring a stay order from the court which passed the decree or from an appellate court. Likewise the court which passed the decree may for sufficient cause stay execution of an appealable decree under Order XLI, rule 5, sub-rule (2) if the application for stay is made within the time allowed for appealing therefrom.

In practice, the courts stay the proceedings just to give time to the judgment-debtor to bring a stay order from the appellate court. Once the appeal is preferred, it is the appellate court alone that can stay the execution under Order XLI, rule 5, sub-rule (1) for sufficient reason. Under Order XXXIX, rule 1 the court may in any pending suit, by a temporary injunction, stay the sale in execution of any property if it is proved by affidavit or otherwise that the property is in danger of being wrongfully sold in execution of a decree.

40. Amendment of Order XXI, rule 26.-

Proceedings in execution are no doubt delayed by reason of the stay orders granted in all these cases. In genuine cases where the judgment-debtor or other party may have a real and substantial grieance against the decree, such stay is necessary and the delay occasioned thereby is unavoidable. But in exercising their discretion under those provisions the courts do not sufficiently discriminate between the claims of an honest judgment-debtor and of one whose only aim is to postpone the evil day of execution. It is impossible to prescribe any hard and fast rule or to enumerate cases in which the courts ought and those in which they ought not to order stay of execution.

The matter has, of necessity, to be left to the court's discretion. But under all the aforesaid provisions the courts have power to impose conditions subject to which a stay can be granted. Dealing first with rule 26 or Order XXI, sub-rule (3) thereof empowers the court before making the stay order to require such security or impose such conditions as it thinks fit. We are of opinion that the requiring of security or the imposing of conditions should be made compulsory and not left to the court's discretion. Sub-rule (3) should be amended by substituting the word "shall" for the word "may" occurring therein. Such an amendment has already been made by the High Courts of Allahabad, Calcutta, Orissa, Nagpur, Patna and Punjab.

41. As regards money decrees, we invited views on alternative proposals. First, that there should be no interim stay of a money decree or, secondly, that the payment of the decretal amount or a substantial part thereof into court should be a condition precedent to the grant of stay of execution of such a decree. The first proposal of a total ban on the stay of money decrees was considered too drastic and did not receive much support. The second was considered more practicable and received general approval.

Deposit of money not to be insisted on.- We do not think it advisable to make a specific provision requiring the deposit of the decretal amount or a substantial part thereof as a condition precedent to the grant of a stay of a money decree if sub-rule (3) is amended in the manner indicated above. We think it more appropriate, even in respect of money decrees to leave it to the court's discretion either to demand security or to impose conditions such as payment of the decretal amount according to the circumstances in each case. To make an absolute rule requiring the deposit of the decretal amount in all cases and to require a refusal of stay of execution in proper cases even if the judgment-debtor be in a position to furnish sufficient security other than a deposit might lead to great hardship.

42. Stay by injunction.-

As regards Order XXXIX, rule 1, suits are some times filed by persons who are strangers to the original decree claiming rights over property under attachment by the executing court and in such suits, at the instance of such parties, the court issues a temporary injunction restraining the sale of the property. The Patna High Court has amended rule 1 of Order XXXIX by adding a proviso that an injunction to restrain a sale or confirmation of a sale or to restrain delivery of possession shall not be granted except in a case where the applicant cannot lawfully prefer, and could not have lawfully preferred a claim to the property or objection to the sale, or to the attachment preceding it, before the court executing the decree.

43. Power to be taken away.-

We are, however, of the opinion that the court's power to order the stay of execution of sales by temporary injunction should be taken away by omitting the words "or wrongfully sold in execution of a decree" from clause (a) of sub-rule (1). The need for such an amendment has been well expressed by the Civil Justice Committee in the following words: " an injunction under that rule practically negatives the right of the decree-holder in most cases. The court that can best know whether the execution should be stopped or not is the executing court. A person who has filed a suit can very well apply to the court executing the decree to stay its hand pending the result of the suit, if he is a party to the decree.

He should not be allowed to ask a court which knows nothing and can only act upon affidavits till a very elaborate enquiry is held, to stay the hands of another court often superior in grade. It may be that in certain cases the executing court may wrongly refuse to stay execution but that can be remedies by an appeal against the order and by applying to the appellate court to stay the execution under Order XLI, rules 5 and 8. If the appellate court refuses to stay execution, the case is not one for the issue of a temporary injunction under Order 39, rule 1.

In these circumstances we think that if the applicant under Order XXXIX, rule 1, is a party to the decree, there is absolutely no necessity to invest a third court with power to stay execution. If he is not a party to the decree then his interests will not be affected by the sale and therefore there is no necessity to stop the sale at all. At the worst it may happen that he may be put out of possession in execution by the purchaser. But he can object to the delivery of possession and if there is any substance in his claim he would not be disturbed; for that will be a case to which Order XXI, rule 99, will apply."1

1. Civil Justice Committee Report, pp. 413-414, para. 6.

44. Stay by appellate court.-

As regards stay by the appellate court the provisions made in rule 5 of Order XLI are in our opinion sufficient and need no change. Sub-rule (1) gives to the court a discretion to order stay of execution for sufficient reason but sub-rule (3) makes it obligatory upon the court to impose certain conditions subject to which stay can be granted. Here again hardships to the decree-holder arise only if the powers granted to the appellate court for ordering stay and imposing conditions are not carefully and properly exercised. It has come to our notice that very often the imperative requirements of the rule are overlooked by the Courts. If the power to ask for security is properly exercised and if in proper cases the security is made to take the form of a money deposit in court, there will be little room for complaint against the operation of this provision.

45. Garnishee debts.-

The present law in regard to the realization of garnishee debts in execution is in our opinion needlessly dilatory. Under rule 46 a debt not secured by a negotiable instrument is attached by an order prohibiting the creditor from recovering it and the debtor from making payment thereof until further orders of the court. If the garnishee admits the debt, the court orders payment of it or so much of it as is admitted to be due into the court. If, however, he denied the debt, the executing court has no power to investigate into the existence of the debt. In such a case one of the following courses may be adopted. The decree-holder may have the debt sold in execution. Or, the decree-holder may have a receiver appointed under section 51 with power to sue for the recovery of the debt.

Finally, the garnishee may apply under rule 58 for releasing the debt from attachment and the party aggrieved by the order in such proceedings may be driven to file a suit under rule 63 with the usual consequences of further appeals and stay of execution during the pendency of the suits and appeals. To avoid the delays which arise, some High Courts have framed rules for garnishee proceedings under which, when the garnishee denied the debt, an issue can be framed by the executing court itself and decided as an issue in a suit with a right of appeal. Such rules have been framed by the High Courts of Calcutta, Madras, Patna and Orissa. We would recommend the incorporation into the Code of rules similar to rules 46A to 46H made by the Calcutta High Court.

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