Anil Kumar vs Rajendra Prasad Singh
2021 Latest Caselaw 1741 Jhar

              IN THE HIGH COURT OF JHARKHAND AT RANCHI
                        C.M.P. No. 451 of 2020

Anil Kumar                            .....   ...Plaintiff/ Petitioner

                               Versus
Rajendra Prasad Singh                .... ....Defendant/Respondent

CORAM : HON'BLE MR. JUSTICE RAJESH SHANKAR

For the Petitioner :- Mr. R.N. Sahay, Sr. Advocate :- Mr. Yashvardhan, Advocate :- Mr. Kirtivardhan, Advocate For the Respondent :-

Order No. 04 Dated: 09.04.2021

The present case is taken up today through Video conferencing.

2. The present writ petition has been preferred for quashing and setting aside the order dated 14.09.2020 passed by the Civil Judge (Senior Division)- I, Dhanbad in Original Suit No. 291 of 2018 whereby the application of the plaintiff/petitioner filed under Order XXXVIII Rules 5 and 6 of the Code of Civil Procedure (CPC) for issuance of direction upon the defendant/respondent to furnish security for the property in question as well as for issuance of order of attachment of the said property in case of default made by the defendant/respondent, has been rejected.

3. The factual background of the case, as stated in the writ petition, is that the petitioner is engaged in Building Construction Business in the name and style of "Pawansut Buildcon India (Pvt.) Ltd". The petitioner and the respondent entered into a development agreement dated 18.01.2013 for construction of a multistoried building (residential-cum- commercial) over the land described in scheduled-A of the plaint. The respondent executed a registered deed of power of attorney dated 26.07.2013 in favour of the petitioner and appointed him as his true power of attorney to look after other needful work with respect to the land in question under the development agreement dated 18.01.2013. The defendant/respondent received a sum of Rs.11,00,000/- from the plaintiff/petitioner pursuant to the terms and conditions of the development agreement, however he did not give necessary permission by signing the relevant documents required for sanction of the building plan and as such the petitioner could not start the project. The petitioner demanded the said advanced amount in view of clause 8 of

the agreement from the respondent and for this, he served various legal notices to the defendant/respondent. Thereafter, the defendant/respondent returned only Rs.3,00,000/- to the petitioner on 16.09.2017. The respondent replied by denying the said claim of the petitioner and demanded an amount of Rs. 4 crores from the petitioner. The petitioner denied the said claim of the respondent by serving the repudiation notice dated 17.11.2017. The respondent made a part payment of Rs.3,00,000/- out of Rs.11,00,000/- and balance of Rs.8,00,000/- is still due to him. The respondent revoked the power of attorney on 28.06.2017 and informed the same to the petitioner vide letter dated 21.07.2017. The petitioner filed a money recovery suit being Original Suit No. 291 of 2018 in the Court of Civil Judge (Sr. Division)-I, Dhanbad. The respondent filed his written statement. In the meantime, the petitioner came to know that the respondent was trying to alienate the suit property and as such he filed an application dated 26.02.2020 under Order XXXVIII Rules 5 and 6 of CPC for issuance of direction upon the defendant/respondent to furnish security for the property in question as well as for order of attachment of the said property in case of default made by the defendant/respondent. The court below, however vide order dated 14.09.2020, rejected the said application. Hence, the present writ petition.

4. The learned Senior Counsel for the petitioner submits that since beginning, the respondent was trying to extract money from the petitioner which would be evident from the fact that the respondent had suppressed the fact of pendency of Partition Suit no. 279 of 2012 between him and his brother, which would suggest malafide intention of the petitioner tainted with ulterior motive far from a fair play and business. The respondent has alienated the property in question by way of a development agreement purportedly with Shri Ganpati Developers and Builders. The court below has erred in rejecting the application dated 26.02.2020 filed under Order XXXVIII Rules 5 and 6 of CPC without taking into consideration that the defendant-respondent had already alienated the property described in Schedule A of the Original Suit No. 291 of 2018 by unilaterally revoking the agreement/contract with the petitioner. The court below failed to consider para 7(k) of the rejoinder filed by the respondent in response to the application filed by the

petitioner wherein he accepted that he had already revoked the power of attorney executed in favour of the petitioner on 28.06.2017, which would reflect the intention of the respondent to alienate the property. It is further submitted that the court below wrongly appreciated the fact that the agreement dated 18.01.2013 had lapsed without considering that the agreement would lapse only after 5 years from the date of passing of the building plan by MADA, but the respondent revoked the same in the year 2017 itself which was much before the lapse of stipulated time period of 5 years. It is also submitted that the unilateral revocation of the power of attorney and the contract by the respondent is sufficient to satisfy that there is a reasonable chance of alienation of the property by the defendant/respondent which would obstruct the execution of any decree that may be passed against him.

5. Heard the learned counsel for the petitioner and perused the materials available on record. The petitioner is aggrieved with order dated 14.09.2020 passed by the court below whereby the said court has rejected the application filed by the petitioner under Order XXXVIII Rules 5 and 6 of CPC for restraining the respondent from disposing of the property or for furnishing security for the same.

6. The learned court below has rejected the petitioner's application with following observations:-

"In the foregoing discussion, it has been well founded that it is contention of the plaintiff that defendant not returned Rs.8.00 lacs out of Rs.11.00 lacs whereas it has been asserted by the defendant that only Rs.27500 is remained to be paid by the defendant to the plaintiff at best as per terms of the agreement. It is worth to mention here that the terms of the agreement and question of cost of boundary, counter claim of defendant if any etc. may obviously be examined during the course of trial. Even though the plaintiff has stated that defendant is making serious and hectic efforts to alienate the property mentioned in Schedule-A of the plaint but no cogent material has been brought by the plaintiff on record to substantiate his assertion under the circumstances that defendant totally denied this fact. Moreover, on perusal of development agreement dated 18.01.2013 there is an arbitral clause in para 22 but the plaintiff has not taken any recourse under the Arbitration and Conciliation Act. Therefore, in the view of above discussed facts and reasons, I am of the opinion that the plaintiff fails to make out a prima facie case and to establish the defendant are alienating the schedule property. Thus, the plaintiff is not entitled to any relief under Order 38 rule 5 and 6 of the C.P.C. Accordingly, the petition of plaintiff is hereby

dismissed and disposed of. However no order of cost."

7. To appreciate the contention of the learned counsel for the petitioner, I have gone through the provisions of Order XXXVIII Rules 5 and 6 of CPC, which read as under:-

"5. Where defendant may be called upon to furnish security for production of property. - (1) Where, at any stage of a suit, the Court is satisfied, by affidavit or otherwise, that the defendant, with intent to obstruct or delay the execution of any decree that may be passed against him,-

(a) is about to dispose of the whole or any part of his property, or

(b) is about to remove the whole or any part of his property from the local limits of the jurisdiction of the Court, the Court may direct the defendant, within a time to be fixed by it, either to furnish security, in such sum as may be specified in the order, to produce and place at the disposal of the Court, when required, the said property or the value of the same, or such portion thereof as may be sufficient to satisfy the decree, or to appear and show cause why he should not furnish security.

(2) The plaintiff shall, unless the court otherwise directs, specify the property required to be attached and the estimated value thereof.

(3) The Court may also in the order direct the conditional attachment of the whole or any portion of the property so specified.

(4) If an order of attachment is made without complying with the provisions of sub-rule (1) of this rule such attachment shall be void.

6. Attachment where cause not shown or security not furnished. - (1) Where the defendant fails to show cause why he should not furnish security, or fails to furnish the security required, within the time fixed by the Court, the Court may order that the property specified, or such portion thereof as appears sufficient to satisfy any decree which may be passed in the suit, be attached.

(2) Where the defendant shows such cause of furnishes the required security, and the property specified or any portion of it has been attached, the Court shall order the attachment to be withdrawn, or make such other order as it thinks fit."

8. In view of the aforesaid provisions, if the court is satisfied with the affidavit or otherwise that the defendant in order to avoid decree, that may be passed against him, is trying to dispose of whole or any part of his property or is about to displace it from the local limits of the jurisdiction of the court, the court may order the defendant either to furnish security for production of the said property or value of the same or such portion thereof which is sufficient to satisfy the decree at the disposal of the court, when required, or to appear and show cause as to why he should not furnish security. If the defendant fails to show cause as to why he should not furnish security, or fails to furnish the security

required, the Court may order that the property specified or such portion thereof as appears sufficient to satisfy any decree which may be passed in the suit, be attached.

9. Thus, an order under Order XXXVIII Rules 5 and 6 of CPC cannot be passed in a routine manner on mere request of the plaintiff, rather the court must be satisfied with the affidavit or otherwise that the defendant is trying to dispose of or to displace the property to avoid the execution of any decree that may be passed against it.

10. In a judgment rendered by the Hon'ble Supreme Court in the case of Raman Tech. & Process Engg. Co. & Others Vs. Solanki Traders reported in (2008) 2 SCC 302, which has been followed by the learned court below while passing the impugned order, it has been held that while passing the order under Rule 5, the court should firstly satisfy itself that there is prima facie case of the plaintiff and thereafter to examine as to whether the interest of the plaintiff should be protected by exercising power under Order XXXVIII Rule 5 CPC and thus the plaintiff should satisfy that defendant is attempting to remove or to dispose of his assets with an intention of defeating the decree that may be passed.

11. In the present case, the petitioner failed to show prima facie case in his favour before the court below or the fact that the respondent is trying to dispose of his property with an intention to defeat the decree that may be passed against him.

12. Most importantly, the suit has been filed by the petitioner for recovery of money and not for claiming any right over the land in question and as such even if the respondent is trying to dispose of the property, the same would not cause any loss to the petitioner in view of the fact that in the eventuality of passing any decree in his favour, the same can effectively be executed by recovering the said money from the respondent through various other means.

13. In view of the aforesaid legal and factual position, I do not find any infirmity in the order dated 14.09.2020 passed by the Civil Judge (Senior Division)-I, Dhanbad in Original Suit No. 291 of 2018 rejecting the application of the petitioner filed under Order XXXVIII Rules 5 and 6 of CPC.

14. The C.M.P. is, accordingly, dismissed.

Ritesh/AFR                                                 (Rajesh Shankar, J.)