Telangana High Court
Adepu Praveen Kumar vs Kapil Chits Kakatiya Private Limited on 20 June, 2025
Author: K. Lakshman
Bench: K. Lakshman
HON'BLE SRI JUSTICE K. LAKSHMAN
CIVIL REVISION PETITION No.1947 OF 2025
ORAL ORDER:
Heard Mr. Bathula Rajesh, learned counsel for the petitioner -
judgment debtor Nos.2 and 3 and Mr. K.P.Vijay Kumar, learned
counsel for respondent No.1- decree holder.
2. This revision is filed under Section - 227 of the Constitution
of India challenging the registration of EP and the consequential
attachment order dated 04.10.2023 passed in E.P. No.377 of 2023 in
Arbitration Case ARB No.719 of 2020 by Principal Junior Civil
Judge, Karimnagar.
3. Perusal of record would reveal that on the application filed
by respondent No.1 vide Arbitration Case ARB No.719 of 2020, the
Chit Arbitrator/Deputy Registrar of Chits, Karimnagar, had passed an
award dated 16.05.2023 holding that the petitioners herein and
respondent Nos.2 to 4 are jointly and severally liable to pay an amount
of Rs.4,03,392/- along with interest @ 18% per annum from the date
of petition i.e., on 04.08.2020 to till the date of realization. They shall
also pay Rs.10,418/- towards costs of the arbitration proceedings.
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4. Pursuant to the said award, respondent No.1 herein had filed
an execution petition vide E.P. No.377 of 2023 in ARB No.719 of
2020 against the petitioners herein and respondent Nos.2 to 4 for
recovery of Rs.5,22,256/- from them. Vide the aforesaid order, learned
Principal Junior Civil Judge, Karimnagar, directed the Disbursing
Officer of the petitioners herein to withhold the aforesaid amount from
the monthly salary of the petitioners herein, judgment debtor Nos.2
and 5 in the said E.P. Respondent No.2 herein is the chit subscriber,
while the petitioners herein and respondent No.3 and 4 are the
guarantors for the subject chit.
5. It is contended by learned counsel for the petitioners herein
that the Executing Court did not order for proportionate deduction
among judgment debtor Nos.1 to 5. Before passing the order, the
Executing Court neither issued notice, nor provided opportunity of
hearing.
6. In the light of the said submission, it is relevant to extract
Order - XXI, Rules - 11 (2), 48 and 48A of the CPC, which are as
under:
"XXI Rule 11 (2) of CPC-Written application- Save as
otherwise provided by sub-rule(1), every application for the
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execution of a decree shall be in writing, signed and verified by
the applicant or by some other person proved to the satisfaction
of the Court to be acquainted with the facts of the case, and shall
contain in a tabular form the following particulars, namely-
(a) the number of the suit;
(b) the names of the parties;
(c) the date of the decree;
(d) whether any appeal has been preferred from the decree;
(e) whether any, and (if any) what, payment or other adjustment
of the matter in controversy has been made between the parties
subsequently to the decree;
(f) whether any, and (if any) what, previous applications have
been made for the execution of the decree, the dates of such
applications and their results;
(g) the amount with interest (if any) due upon the decree, or
other relief granted thereby, together with particulars of any
cross-decree, whether passed before or after the date of the
decree sought to be executed;
(h) the amount of the costs (if any) awarded;
(i) the name of the person against whom execution of the decree
is sought; and
(j) the mode in which the assistance of the Court is required
whether-
(i) by the delivery of any property specifically decreed;
(ii) by the attachment, or by the attachment and sale, or by the
sale without attachment, of any property;
(iii)by the arrest and detention in prison of any person;
(iv) by the appointment of a receiver;
(v) otherwise, as the nature of the relief granted may require."
"Order XXI Rule 48 of CPC-Attachment of salary or
allowances of servant of the Government or railway
company or local authority.- (1) Where the property to be
attached is the salary or allowances of a servant of the
Government or of a servant of a railway company or local
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authority or of a servant of a corporation engaged in any trade or
industry which is established by a Central, Provincial or State
Act, or a Government company as defined in section 617 of the
Companies Act, 1956 (1 of 1956)] the Court, whether the
judgment-debtor or the disbursing officer is or is not within the
local limits of the Court's jurisdiction, may order that the
amount shall, subject to the provisions of section 60, be
withheld from such salary or allowances either in one payment
or by monthly instalments as the Court may direct; and upon
notice of the order to such officer as the appropriate
Government may by notification in the Official Gazette appoint
in this behalf,-
(a) where such salary or allowances are to be disbursed
within the local limits to which this Code for the time being
extends, the officer or other person whose duty it is to
disburse the same shall withhold and remit to the Court the
amount due under the order, or the monthly instalments, as
the case may be;
(b) where such salary or allowances are to be disbursed
beyond the said limits, the officer or other person within
those limits whose duty it is to instruct the disbursing
authority regarding the amount of the salary or allowances
to be disbursed shall remit to the Court the amount due
under the order, or the monthly instalments, as the case may
be, and shall direct the disbursing authority to reduce the
aggregate of the amounts from time to time, to be disbursed
by the aggregate of the amounts from time to time remitted
to the Court.
(2) Where the attachable proportion of such salary or allowances
is already being withheld and remitted to a Court in pursuance
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of a previous and unsatisfied order of attachment, the officer
appointed by the appropriate Government in this behalf shall
forthwith return the subsequent order to the Court issuing it with
a full statement of all the particulars of the existing attachment.
(3) Every order made under this rule, unless it is returned in
accordance with the provisions of sub-rule (2) shall, without
further notice or other process, bind the appropriate Government
or the railway company or local authority or corporation of
Government company, as the case may be, while the judgment-
debtor is within the local limits to which this Code for the time
being extends and while he is beyond those limits, if he is in
receipt of any salary or allowances payable out of the
Consolidated Fund of India or the Consolidated Fund of the
State or the funds of a railway company or local authority or
corporation or Government company in India; and the
appropriate Government or the railway company or local
authority or corporation or Government company, as the case
may be, shall be liable for any sum paid in contravention of this
rule.
Explanation.-In this rule, "appropriate Government"
means,-
(i) As respects any person in the service of the Central
Government, or any servant of a railway administration or of a
cantonment authority or of the port authority of a major port, or
any servant of a corporation engaged in any trade or industry
which is established by a Central Act, or any servant of a
Government company in which any part of the share capital is
held by the Central Government or by more than one State
Governments or partly by the Central Government and partly by
one or more State Governments, the Central Government;
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(ii) As respects any other servant of the Government, or a
servant of any other local or other authority, or any servant of a
corporation engaged in any trade or industry which is
established by a Provincial or State act, or a servant of any other
Government company, the State Government."
"Order - XXI, Rule - 48A. Attachment of salary or
allowances of private employees.- (1) Where the property to be
attached is the salary or allowances of an employee other than
an employee to whom rule 48 applies, the Court, where the
disbursing officer of the employee is within the local limits of
the Court's jurisdiction, may order than the amount shall, subject
to the provision of section 60, be withheld from such salary or
allowances either in one payment or by monthly instalments as
the Court may direct; and upon notice of the order to such
disbursing officer, such disbursing officer shall remit to the
court the amount due under the order, or the monthly
instalments, as the case may be.
(2) Where the attachable portion of such salary or allowances is
already being withheld or remitted to the Court in pursuance of
a previous and unsatisfied order of attachment, the disbursing
officer shall forthwith return the subsequent order to the Court
issuing it with a full statement of all the particulars of the
existing attachment.
(3) Every order made under this rule, unless it is returned in
accordance with the provisions of sub-rule (2), shall, without
further notice or other process, hind the employer while the
judgment-debtors, is within the local limits to which this Code
for the time being extends and while he is beyond those-limits,
if he is in receipt of salary or allowances payable out of the
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funds of an employer in any part of India, and the employer
shall be liable for any sum paid in contravention of this rule."
7. It is relevant to extract Section - 71 of the Chit Fund Act,
1982 and the same is as under:
"71. Money how recovered.--Every order passed by the
Registrar or the nominee under section 68 or section 69 and
every order passed by the State Government in appeal under
section 70 for payment of any money shall, if not carried out,--
(a) on a certificate issued by the Registrar, be deemed to be a
decree of a Civil Court, and shall be executed in the same
manner as a decree of such Court, or
(b) be executed in accordance with the provisions of any law for
the time being in force for the recovery of amounts as arrears of
land revenue: Provided that no application for execution under
clause (b) shall be made after the expiry of three years from the
date fixed in the order, and if no such date is fixed, from the date
of the order."
8. It is also relevant to extract Sections - 126, 128 and 146 of
the Indian Contract Act, 1872 and the same is as under:
"126. "Contract of guarantee", "surety", "principal debtor"
and "creditor".--A "contract of guarantee" is a contract to
perform the promise, or discharge the liability, of a third person
in case of his default. The person who gives the guarantee is
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called the "surety"; the person in respect of whose default the
guarantee is given is called the "principal debtor", and the
person to whom the guarantee is given is called the "creditor". A
guarantee may be either oral or written."
"128. Surety's liability.--The liability of the surety is co-
extensive with that of the principal debtor, unless it is otherwise
provided by the contract."
"146. Co-sureties liable to contribute equally.--Where two or
more persons are co-sureties for the same debt or duty, either
jointly or severally, and whether under the same or different
contracts, and whether with or without the knowledge of each
other, the co-sureties, in the absence of any contract to the
contrary, are liable, as between themselves, to pay each an equal
share of the whole debt, or of that part of it which remains
unpaid by the principal debtor."
9. Thus, the liability of the co-surety is co-extensive with that
of principal debtor unless it is otherwise provided by the contract.
The said principle was also laid down by a Division Bench of the
High Court of Judicature for the States of Telangana and Andhra
Pradesh at Hyderabad in Punyamurthula Venkata Viswa Sundara
Rao v. M/s. Margadarsi Chit Fund Pvt. Ltd. 1.
. 2017 (3) ALT 82 (D.B.)
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10. The aforesaid relevant provisions would reveal that for
realization of the amount covered under the arbitration award,
respondent No.1 - decree holder has to file an application under Order
- XXI Rule 11 (2) of CPC. Accordingly, respondent No.1 had filed the
aforesaid execution petition vide E.P.No.377 of 2023.
11. In Punyamurthula Venkata Viswa Sundara Rao1, the
Division Bench of this Court on consideration of the submissions
made by the parties, framed the following two (02) points for
consideration:
i. whether the decree holder has to proceed against all the
judgment debtors, who are guarantors, by claiming
proportionate amount decreed.
ii. whether the execution Courts in which E.Ps. were filed
against the present judgment debtors, who are revision
petitions herein, have jurisdiction to entertain the
execution petitions.
12. On consideration of the provisions of the Chit Fund Act
and the CPC, the Division Bench held that the course that has to be
followed by the decree holder is to make an application to the
Registrar for execution, to be forwarded to the proper authority at the
option of the decree holder and the Registrar shall himself issue the
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certificate and forward the said application to the Court or revenue
authority, as chosen by the decree holder. The decree holder has an
option to proceed against either the principal debtor or any of the
guarantors or against all of them.
13. Referring to Section - 128 of the Indian Contract Act, the
Division Bench held that the liability of a surety is co-extensive with
that of the principal debtor unless it is otherwise provided by the
contract.
14. In Madamanchi Anill Kumar v. Margadarshi Chit Fund
Pvt. Limited,2 Division Bench of the High Court of Andhra Pradesh
at Hyderabad considering the said principle laid down by the Division
Bench in Punyamurthula Venkata Viswa Sundara Rao1, held that
liability of the sureties is joint and several. The Division Bench also
negatived the contention raised by the petitioner therein that a
Recovery Certificate issued by the Deputy Registrar of Chits cannot
be acted upon, as per Rule - 55 of the Andhra Pradesh Chit Fund
Rules, 2008 and that an execution is maintainable only if the recovery
certificate has been issued by the Registrar of Chits to the competent
Civil Court.
. CRP No.2338 of 2018, decided on 05.11.2018
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15. On consideration of the aforesaid provisions and on
examination of the facts of the case therein, in Bandi Chandra Hari
v. Brindavan Chits Karimnagar India Private Limited3, this Court
held that respondent No.1 - decree-holder cannot recover double the
awarded amount from the petitioners - judgment debtor Nos.2 and 5,
and it is entitled for the decretal amount and interest including pendent
lite interest as claimed by it from the judgment debtors.
16. It is apt to note that on realization of the decretal amount,
costs, interest and pendent lite interest, respondent No.1 - decree-
holder shall file a full-satisfaction memo before the Executing Court
with a request to terminate the proceedings in the subject EP. If
respondent No.1 fails to file such full satisfaction memo, Executing
Court can terminate the execution proceedings in the EP on its own.
17. In view of the aforesaid discussion and observation, the
present Civil Revision Petition is disposed of directing the Executing
Court to follow the procedure laid down under the Indian Contract Act
and principle laid down in the aforesaid judgments and dispose of the
. CRP No.1237 of 2024, decided on 03.05.2024
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aforesaid execution petition. In the circumstances of the case, there
shall be no order as to costs.
As a sequel thereto, miscellaneous petitions, if any, pending in
this revision shall stand closed.
_________________
K. LAKSHMAN, J
20th June, 2025
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