Calcutta High Court
Skipper Limited vs Prabha Infrastructure Private ... on 23 September, 2022
1
ODC-1
IA No. GA/1/2022
In
CS/195/2022
IN THE HIGH COURT AT CALCUTTA
Ordinary Original Civil Jurisdiction
ORIGINAL SIDE
[COMMERCIAL DIVISION)
SKIPPER LIMITED
-VS-
PRABHA INFRASTRUCTURE PRIVATE LIMITED
BEFORE :
The Hon'ble JUSTICE KRISHNA RAO
Date: 23rd September, 2022.
Appearance:
Mr. Sayantan Bose, Adv.
Ms. Madhurima Das, Adv.
Mr. Shounak Mukhopadhyay, Adv.
... for the plaintiff
Mr. Sankarsan Sarkar, Adv.
Mr. Ritoban Sarkar, Adv.
Ms. Tanvi Luhariwala, Adv.
Mr. Rites Goel, Adv.
... for the defendant
ORDER
The plaintiff has filed the instant application praying for a direction upon
the defendant to furnish sufficient and proper security for an amount of Rs.
49,95,155/-. The plaintiff has filed the suit against the defendant for a decree
of Rs. 49,95,155/- along with interest at the rate of 24 % per annum. The
plaintiff company carrying the business of integrated transmission tower
manufacturing with angle rolling tower accessories and fastening
manufacturing and EPC line construction. The defendant is an infrastructure
development company providing a wide spectrum of solution and services in
various facets of Indian basic infrastructure, i.e. power, telecom, water supply,
project and property development. The defendant had issued purchased order
to the plaintiff by an electronic mail dt. 22nd August, 2020 and subsequently
the purchase order was amended.
On receipt of PDC-1, the plaintiff dispatched the first lot of goods in
terms of purchase orders and issued 8 (eight) tax invoices for an aggregate sum
of Rs. 51,39,807/- and the said goods were delivered to the defendant and the
defendant had accepted the said goods and utilized the same. On 11th January,
2021, the defendant made payment of a sum of Rs. 37,66,368/- towards the
balance price of goods sold and delivered to the defendant as Lot-1. On 27th
January, 2021 the defendant made payment of Rs. 10,29,133/- in terms of
invoice -3.
As per assurance of the defendant, the plaintiff has dispatched the goods
deliverable as part of the second lot to the defendant in between 28th January,
2021 and 31st January, 2021 and raised 8 (eight) invoices for an amount of Rs.
54,99,261/-. The plaintiff had supplied the goods to the defendant total
amounting to Rs. 1,06,39,068/- against which the defendant had paid an
amount of Rs. 66,31,966/- and balance amount of Rs. 40,07,102/- is due and
payable by the defendant.
The plaintiff had made several requests to the defendant for payment of
the balance amount and on 9th March, 2021 and 15th March, 2021 the
defendant had informed the plaintiff that bank account of the defendant had
been frozen on account of an issue relating to Goods and Service Tax and
requested time to make payment of the balance sum of Rs. 40,07,102/-.
Meeting was also held between the parties and the defendant had agreed to pay
the balance amount but inspite of the assurance made by the defendant
through mail had not paid the said amount.
Ld. Counsel for the plaintiff submits that the defendant has admitted its
liability to pay the balance amount of Rs. 40,07,102/- through the mails dated
9th March, 2021 and 20th March, 2021 as well as in the meeting dt. 23rd
August, 2021 but inspite of the same the defendant had not paid the said
amount and now the plaintiff apprehends that the defendant with the intent to
obstruct and delay the execution of any decree that may passed against the
defendant is about to dispose of or otherwise render inaccessible the whole or
parts of the funds in the bank account of the defendant being account No.
08344015005486 in the Oriental Bank of Commerce, Sigra, Varanasi Branch.
Ld. Counsel for the plaintiff prays for a direction upon the defendant to
furnish proper and sufficient security for the sum of Rs. 49,95,155/- or in the
alternative to show cause as to why an order of attachment before judgment be
passed in respect of defendant's bank account.
Per contra, Ld. Counsel for the defendant submits that there is no
promise on the part of the defendant that the defendant assures that the
defendant will pay the amount as claimed by the plaintiff. The mails relied by
the plaintiff in the said mails there is no mention with regard to the quantum
of amount as claimed by the plaintiff. In the mail dt. 24th August, 2021, it is
mentioned that the defendant will release Rs. 20,00,000/- within 29th August,
2021 and the balance amount will be release after site material reconciliation
/GRN etc. and time line decided 1st week of September, 2021. The bank
account of the defendant is located at Varanasi which is outside the
jurisdiction of this Court and the amount receivable from Railway
Electrification is at Jaipur which is also outside of the jurisdiction of this
Court.
Ld. Counsel for the defendant submits that as per Order 38, Rule 5 of
the Code of Civil Procedure, two aspects needs to be satisfied : (i) The
unimpeachable character of the claim and, (ii) The satisfaction of the Court
that in the absence of security being furnished, the plaintiff would be left with
a paper decree with little or no assets to proceed with execution but in the
instant case the plaintiff has not made out such case.
Ld. Counsel for the defendant has relied upon the unreported order
passed in FMA 1674 of 2019 with CAN 10119 of 2019 (QVC Exports Private
Limited and Others - vs- Cosmic Ferro Alloy Ltd. & Others) dt. 28.11.2019 and
judgment reported in 2009 SCC Online Cal 1638 (Sunil Kakrania & Ors. -Vs-
M/s. Saltee Infrastructure Ltd. & Anr.) and prays for rejection of the prayer
made by the plaintiff.
Heard, the Ld. Counsel for the respective parties, considered the
pleadings and the documents relied by the parties. The suit filed by the plaintiff
is money claim. As per the averments and the documents, the plaintiff has
supplied materials as per the requirements of the defendants and the plaintiff
has raised invoices. The defendant has paid some amount and some amounts
are required to be paid. The Plaintiff has claimed Rs. 40,07,102/- as principal
amount and Rs. 9,88,053/- being interest. The plaintiff has relied upon the
emails wherein the defendant has informed the plaintiff that the bank account
of the defendant has been frozen due to some GST problem due to which the
defendant is not in a position to transfer the amount in time. In the email dt.
24th August, 2021, the defendant has also informed the plaintiff that the
defendant will release Rs. 20,00,000/- by 29th August, 2021 and the balance
payment will be release after site materials reconciliation.
The order passed in the case of QVC Exports Private Limited and Others
(supra), the Hon'ble Division Bench of this Court held that :
"More importantly, an order in the nature of an attachment before
judgment is a high order and there are two aspects that need to be
satisfied before such an order is issued. The first aspect is the
unimpeachable character of the claim and the second aspect is the
satisfaction of the court that in the absence of security being furnished, the
plaintiff would be left with a paper decree with little or no assets to
proceed against in execution. It is elementary that there cannot even be
subjective satisfaction as to the unimpeachable character of a claim
without the adversary being called upon to answer the claim. It is equally
fallacious to reach a subjective satisfaction as to the impecunious or
parlous state of a defendant without the defendant being given an
opportunity to show cause. Indeed, the order impugned militates against
the scheme of Order XXXVIII of the Code.
While it is imperative that courts came down heavily on parties who
have no excuse not to pay and only take advantage of the court's delays to
deny a just claim, the court has to adhere to the statutory safeguards and
exercise self-restraint before jumping to a conclusion on the one-sided
version of the plaintiff without giving the defendant an opportunity to
answer the case. Indeed, the order impugned lacks any ground indicating
why an ex parte order was called for and how, unless an ex parte order
was made, the plaintiff would have been seriously prejudiced."
In the judgment reported in the case of Sunil Kakrania & Ors. (supra),
the Hon'ble Division bench of this Court held that :
"24. In the case of Premraj Mundra vs. Md. Manech Gazi reported
in AIR 1951 Cal. 156, approved by the Apex Court in the aforesaid
decision, Sinha, J. (as His Lordship then was) laid down the following
principles required to be followed by a Court before invoking the
jurisdiction under Order 38 Rule 5:
"(10) From a perusal of all the authorities, I think that the following guiding
principles can be deduced:
(1) That an order under O. 38, Rr. 5 & 6, can only be issued, if
circumstances exist as are stated therein.
(2) Whether such circumstances exist is a question of fact that must be
proved to the satisfaction of the Court.
(3) That the Court would not be justified in issuing an order for attachment
before judgment, or for security, merely because it thinks that no harm
would be done thereby or that the defts would not be prejudiced.
(4) That the affidavits in support of the contentions of the applicant, must
not be vague, & must be properly verified. Where it is affirmed true to
knowledge or information or belief, it must be stated as to which portion is
true to knowledge, the source of information should be disclosed, and the
grounds for belief should be stated.
(5) That a mere allegation that the deft, was selling off & his properties is
not sufficient. Particulars must be stated.
(6) There is no rule that transactions before suit cannot be taken into
consideration, but the object of attachment before judgment must be to
prevent future transfer or alienation.
(7) Where only a small portion of the property belonging to the deft. is being
disposed of, no inference can be drawn in the absence of other
circumstances that the alienation is necessarily to defraud or delay the
pltfs. claim.
(8) That the mere fact of transfer is not enough, since nobody can be
prevented from dealing with his properties simply because a suit has been
filed. There must be additional circumstances to show that the transfer is
with an intention to delay or defeat the pltf s. claim. It is open to the Court
to look to the conduct of the parties immediately before suit, & to examine
the surrounding circumstances, & to draw an inference as to whether the
deft. is about to dispose of the property, and if so, with what intention. The
Court is entitled to consider the nature of the claim & the defence put
forward."
"25. Applying the aforesaid principles to the facts of the present
case, we find that the statement that has been made in the application for
attachment before judgment was that the defendant is in ruinous condition
and that if the decree was passed in the suit, the plaintiff would not be in
a position to execute the decree if the defendant was able to transfer or
alienate the property mentioned. On the basis of such vague allegation, in
our view, no order or direction to give security or attachment can be
passed as held above. There is even no allegation that the defendant is
trying to remove or dispose of its properties in order to obstruct or delay
the execution of the decree that may be passed against it."
In the instant case, the plaintiff has only averred that :
"54. The plaintiff apprehends that the defendant, with the intent to
obstruct and/or delay the execution of any decree that may be passed
against it in the present suit, is about to dispose of and/or otherwise
render inaccessible the whole and/or part of the funds in the defendant's
said bank account being Account No. 08344015005486 held with Oriental
Bank of Commerce, Sigra, Varanasi Branch situated at D-58 9, A-1, Sigra,
Varanasi - 221002."
In view of the of the above, this Court is of the view that ingredients of
the provisions of Order 38, Rule 5 is not attracted and thus the prayer (b)(c)
and (d) are rejected.
As regard the prayer (a), the Counsel for the defendants prays for time to
file affidavit in opposition. Let, affidavit in opposition be filed within 3 weeks
after Puja Vacation, reply, if any, be filed within two (2) weeks thereafter.
List the matter on 07.12.2022.
(KRISHNA RAO, J.)
p.d
