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19.03.2025 The appellant chose not to press its stay
application and submitted that it will advance
arguments in the main Petition i.e., COP No.134 of
2024 for setting aside of the Award.
The respondent No.1 filed CEA No.60 of 2025
seeking deposit of the monies which had been
attached by the Commercial Court under Order 21
Rule 46A of the CPC.
The Commercial Court passed an order in CEA
No.59 of 2025 permitting the appellant to contest
CEP. Thereafter, the appellant filed its counter in
04.04.2025 The Garnishee bank/SBI filed a Memo stating that
it had withheld and stopped transactions
pertaining to the appellant's accounts in
compliance with the order dated 03.03.2025.
The appellant filed CEA No.92 of 2025 for setting
aside the order of the Commercial Court dated
03.03.2025 directing the Garnishee Bank to
withhold the Bank Account of the appellant.
31.12.2025 The Commercial Court dismissed CEA No.92 of
2025 filed by the appellant. The order dated
31.12.2025 forms the subject matter of the present
Commercial Court Appeal.
MB,J & GPK,J
8. The two objections raised by the appellant/Judgment Debtor No.1
before the Commercial Court to attachment of its account with the
Garnishee Bank were as follows:
Objection I
9. The first objection is that the Treasury Account in which the
amounts have been withheld is the South Central Railway (SCR)
Treasury Account, contains employees' Provident Fund Deposits and is
used for the payment of Life Insurance premiums. Hence, the Treasury
Account cannot be attached as the said Account falls within the
exemptions delineated in the proviso to section 60(1) of the CPC. This
objection finds place in the affidavit filed in support of C.E.A.No.92 of
2025 filed by the appellant/Judgment Debtor No.1.
10. Section 60 falls under Part II (Execution) of the C.P.C. and deals
with 'Property liable to Attachment and Sale in execution of Decree'. The
appellant claims exemptions under clauses (k), (ka), (kb) and (l) of
proviso to section 60(1) of the C.P.C. which, inter alia, relate to
compulsory deposits, sums derived from Provident Funds and Public
Provident Funds, Life Insurance Policies and the emoluments of any
servant of the Government or a Railway Company. However, the
appellant has failed to provide specific particulars demonstrating how
MB,J & GPK,J
these exemptions apply to the property apply to the property which is
sought to be attached in the present case i.e., the appellant's Treasury
Account.
11. The appellant contends that the Treasury Account pertains to its
employees and is utilized for payments towards Life Insurance Policies
thereby rendering it exempt under proviso to section 60(1) of the C.P.C.
The appellant has however failed to provide particulars or cogent
evidence regarding the nature of the property or its eligibility for
exemptions under the proviso to section 60(1). The burden of proof lies
squarely on the party, who seeks to avail the benefit of such exemptions
(in this case, the appellant/Judgment Debtor No.1), to establish that the
property is not liable for attachment or sale under section 60(1) of the
C.P.C; Govindan A Vs. Govindarajan KK 1.
12. The appellant has specifically pleaded that 'some of the amounts
within this account are designated for specific non-discretionary purposes'
and that 'part of the funds held in the SCR Treasury Account falls clearly
within the excepted categories'. However, no details have been furnished
by the appellant either in relation to the individual categories of
exemptions under the proviso to section 60(1) of the C.P.C. or with
regard to any other particulars, including the quantum thereof or the
2007 (2) ILR 654
MB,J & GPK,J
proportion of such contributions in relation to the total balance of the
Treasury Account.
13. It is also pertinent to note that the proviso to section 60(1) of the
CPC carve-out exceptions from attachment in respect of 'the following
particulars' which indicates that only certain specified amounts are
immune from attachment, as opposed to the entire account itself. The
appellant, however, seeks to take advantage of the proviso to section
60(1) of the C.P.C. in respect of the entirety of the Treasury Account.
14. This Court, in fact, took a view in a C.R.P.No.92 of 2026 filed by
the respondent No.1/Krishnapatnam Railway Company Limited that the
appellant/Judgment Debtor's contention that the amounts cannot be
remitted since they consist of Provident Fund and Life Insurance monies
is unsubstantiated. This Court further observed that the appellant failed
to provide clarity as to the specific nature of the attached funds.
Moreover, the appellant's reliance on Union of India Vs. Jyoti Chit Fund
and Finance 2 is misplaced since the said decision specifically dealt with
the issue of locus standi of the Union of India to challenge the
attachment of specific retirement and pensionary benefits.
15. In the present case, the Commercial Court has considered the
merits of the appellant's objection with regard to the exemptions and
(1976) 3 SCC 607
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dismissed the same on the ground that the appellant failed to furnish
any particulars regarding the alleged exemptions. The Commercial
Court, in fact, noted that the appellant did not produce any material
either in its affidavit of assets or in its application (CEA.No.14 of 2025),
to clarify the specific amounts in the Treasury Account are immune from
attachment under the proviso to section 60(1) of the C.P.C. The
Commercial Court further observed that it was incumbent upon the
appellant to disclose specific particulars to substantiate its claim for
exemption from attachment.
Objection II
16. The second objection related to the appellant's contention that the
Commercial Court failed to comply with the procedure prescribed under
Order XXI Rule 46 of the CPC since the Commercial Court issued the
notice to the garnishee (SBI) prior to passing the order of attachment
dated 03.03.2025.
17. The appellant/Judgment Debtor submits that the Commercial
Court failed to follow the procedure laid down under Order XXI Rule
46/46A of the CPC with regard to attachment of debt, share and other
property not in possession of judgment-debtor and notice to garnishee.
According to counsel, the Commercial Court attached the amount lying
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in the South Central Railways Treasury Account on 03.03.2025 and
issued the notice to the Garnishee under Order XXI Rule 46A of the CPC
inviting objections.
18. According to counsel, notice to the Garnishee/SBI under Order
XXI Rule 46A could only have been issued after 19.03.2025 in the
application filed by the Decree Holder/respondent No.1 for deposit of the
money attached by the Commercial Court (CEA.No.60 of 2025) .
19. In this context, the procedure under Order XXI Rule 46 of the CPC
is required to be set out in stages. The stages with regard to Order XXI
Rule 46 are set out in sequence.
(i) Order XXI Rule 46 of the CPC empowers the executing
Court to attach a debt, share or other property which is
not in possession of the Judgment Debtor, except the
property deposited in, or in the custody of the Court:
Order XXI Rule 46(1)(c).
(ii) The Court shall attach the property by way of a written
order prohibiting the person in possession of the movable
property from giving it over to the judgment-debtor: Order
XXI Rule 46(1)(c)(iii).
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(iii) A copy of the order of attachment shall be affixed on some
conspicuous part of the Court-house; another copy of the
order shall be sent (in the case of movable property) to the
person in possession of the same: Order XXI Rule 46(2).
20. The present case deals with movable property (money) not in the
possession of the Judgment Debtor (the appellant). The person in
possession of the movable property is the Garnishee/SBI.
21. Order XXI Rule 46A of the CPC, this provision is distinct and
different from Order XXI Rule 46 where the debt/ share/ other movable
property has been attached by the Court. The sequence under Order XXI
Rule 46A is set out hereunder.
(i) Order XXI Rule 46A gives the option to the Court in a
case where the debt has already been attached under
Rule 46 of Order XXI to issue notice to the Garnishee who
is liable to pay the said debt and calling upon the
Garnishee either to pay the debt to the Court or a part
thereof which would satisfy the decree and costs of
execution or to appear and show cause as to why the
Garnishee should not pay the debt or a part thereof. The
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Court's notice to the Garnishee is subject to an
application made by the attaching creditor to the Court 3.
(ii) Order XXI Rule 46A makes it clear that the stage of
'Notice to Garnishee' comes after the stage of attachment
of debt/ share/ property under Order XXI Rule 46. This
would be clear from the language or Order XXI Rule 46A
which clarifies that the Court may issue notice to the
Garnishee in relation to a debt '...which has been
attached under rule 46...' (underlined for emphasis).
Moreover, the issuance of notice to the Garnishee is also
not mandatory which would be evident from the words
'The Court may in the case of a debt...'.
(iii) Order XXI Rule 46B follows Rule 46A where the
Garnishee does not forthwith pay the amount due to him
to the judgment-debtor into the Court or the amount
thereof which would be sufficient to the decree of the
Court and the costs of execution.
(iv) Order XXI Rule 46 would also apply, in conjunction,
where the Garnishee does not appear and show cause in
answer to the notice sent under Order XXI Rule 46A. In
3 Bhagyoday Coop. Bank Ltd. Vs. Ravindra Balkrishna Patel; (2022) 14 SCC 417
MB,J & GPK,J
the aforesaid circumstances, the Court may order the
Garnishee to comply with the terms of the notice sent
under Rule 46A.
(v) Order XXI Rule 46C is the next stage where the Court
may order any issue of question necessary for
determination of liability of Garnishee to be tried as if it
were an issue in a Suit where the Garnishee disputes
liability. The Court may pass orders after determination
of the issue as it deems fit.
(vi) Order XXI Rule 46F provides for valid discharge in the
event the Garnishee makes the payment on the notice
under Rule 46A or under any similar orders which shall
then amount to a valid discharge to a Garnishee as
against judgment-debtor.
22. The above sequence makes it clear that the scope and purpose of
Rule 46 and Rule 46A of Order XXI of the CPC.
23. Order XXI Rule 46 of the CPC empowers the Court to attach a
property which is not in possession of the judgment-debtor by way of a
written order. The order of attachment, is directed against the person
who is in possession of property and prohibiting that person from
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handing over the property to the judgment debtor. The underlying object
of Order XXI Rule 46(1) would be clear from the procedure envisaged in
Order XXI Rule 46(2) which stipulates that the second copy of the notice
of the order must be sent to the person in possession of the movable
property which is in possession of that person but not in possession of
judgment debtor.
24. On the other hand, Order XXI Rule 46A of the CPC is for the
purpose of giving certain directions to the Garnishee in respect of the
debt or part thereof to satisfy the decree and costs of execution to the
Court. The primary principle is for Garnishee to appear in person and
show cause and give Garnishee an opportunity to contest the notice
under Order XXI Rule 46A where the Garnishee refuses to comply with
the contents of the notice. Order XXI Rule 46A is premised upon an
application filed by the attaching creditor to the Court for issue of notice
and direction to the Garnishee as aforesaid.
25. The facts of the present case indicate that the order of attachment
was made by the Court under Order XXI Rule 46 of the CPC on
03.03.2025 wherein the Court directed the Garnishee Bank/respondent
No.2 to withhold CEP amount of Rs.605,07,94,064/- inclusive of interest
in the appellant's SBI Bank account.
MB,J & GPK,J
25.1. The appellant was set ex parte by the Commercial Court on
03.03.2025. On 17.03.2026, the appellant/Judgment-Debtor filed an
application (CEA.No.59 of 2025) for setting aside the order dated
03.03.2025 and seeking permission for coming on record to contest the
CEP.
25.2. On 19.03.2025, the appellant made a specific submission that it
was not pressing its stay application and will only advance arguments in
the main application for setting aside the Award under section 34 of The
Arbitration and Conciliation Act, 1996 (COP.No.134 of 2024).
25.3. On 19.03.2025, the Court allowed the appellant's application
(CEA.No.59 of 2025) to the extent of giving the appellant an opportunity
to contest the execution proceedings. The attachment order dated
03.03.2025 was however not set aside.
26. On 04.04.2025, the Garnishee Bank filed a Memo stating that it
had complied with the order dated 03.03.2025 with regard to the
direction on it to withhold the execution petition amount of
Rs.605,07,94,064/- lying in the Judgment Debtor's Bank Account
bearing No.62337131167, Government Ministry of Railways, South
Central Railways/FA & CAO/Sec-Bad, SBI, Himmatnagar,
Secunderabad. On the same day i.e., on 04.04.2025, the appellant filed
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CEA.No.92 of 2025 for setting aside of the directions on the Garnishee
Bank and for release of SCR Treasury Account from attachment or
prohibitory orders. The appellant/Judgment Debtor's application, was
dismissed by the Commercial Court by the impugned order dated
31.12.2025.
27. The narration of events eliminates the basis of the
appellant/Judgment-Debtor's argument that the Commercial Court
failed to comply with the procedure under Order XXI Rule 46A of the
CPC.
28. The very fact of the Garnishee Bank filing a Memo stating that it
had complied with the order of attachment dated 03.03.2025 and had
withheld/stopped transactions pertaining to the said account from
19.03.2025 would render the proceedings under Order XXI Rule 46A
unnecessary and irrelevant. As stated above, Order XXI Rule 46A is only
for the purpose of giving an opportunity to the Garnishee to show cause
or challenge the notice issued by the Court to the Garnishee on an
application made by attaching creditor. Therefore, Order XXI Rule 46A
ceases to have any application once the Garnishee has reported
compliance of order of attachment made under the preceding provision,
i.e., Order XXI Rule 46 of the CPC. The admitted fact in the present case
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is that the Garnishee does not dispute liability and confirmed its
compliance with the attachment order passed by the Commercial Court.
29. Therefore, the second objection with regard to the alleged non-
compliance of the provisions under Order XXI Rule 46A of the CPC in
terms of issuance of notice to the Garnishee or that the said notice could
not have been issued on 19.03.2025 is without any factual or statutory
basis.
Section 47 of The Code of Civil Procedure, 1908
30. Section 47 of the CPC deals with the questions to be determined by
the Court executing the decree. Section 47(1) stipulates that all
questions arising between the parties to the suit in which the decree was
passed and relating to the execution, discharge or satisfaction of the
decree, shall be determined by the Court executing decree and not by a
separate suit.
31. The provision makes it clear that the objections raised by the
appellant/Judgment Debtor do not fall within the scope of section 47 as
the executing Court cannot examine the validity of a subsequent order,
which in the present case, is the order dated 03.03.2025. The Arbitral
Award dated 16.07.2024 which awarded the respondent No.1
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Rs.337,56,64,643/- and Rs.246,64,85,601/- as 12% interest
per annum - cumulatively amounting to Rs.584.21 crores along with
future interest @ 12% per annum till the date of realization amounts to a
decree. Hence, the objections raised by the appellant do not relate to the
validity of the decree, even assuming that the Arbitral Award can be the
subject matter of objections under section 47 of the CPC.
32. The executing Court's powers under section 47 of the CPC is
microscopic and lies in a very narrow inspection hole: Dhurandar Prasad
Singh v. Jai Prakash University 4, where the Supreme Court held that the
executing Court can allow objection under section 47 to the executability
of the decree if it is found that the decree is void ab inito and a nullity
and decree is not capable of execution in law.
33. Thus, the objections raised by the appellant in its application
(CEA.No.92 of 2025) in respect of the order dated 03.03.2025 is de hors a
statutory basis and the application was not maintainable under section
47 of the CPC.
34. Last and most important, the Arbitral Award dated 16.07.2024
directed the appellant to pay a sum of Rs.584,21,50,244/- along with
interest @ 12% per annum from the date of the Award till the date of
realization. The appellant has chosen not to press its application for stay
4 2001 6 SCC 534
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of the Award till date. This is specifically recorded in the order of the
Commercial Court dated 19.03.2025. Hence, the Award remains
enforceable as of date. Despite the same, the appellant continues to
raise objections solely to resist and frustrate the execution of the Award.
As already held, the appellant's objections lack any statutory basis and
are clearly intended to delay the execution of the Award, thereby
reducing the Award to a mere 'paper decree'.
35. The cases cited by the appellant/Judgment Debtor do not come to
its assistance. Grey Steel Castings & Finishing Co. P. Ltd. v. Adverts
(Private) Ltd. 5 is on a case-situation warranting the application of Order
XXI Rule 46A of the CPC. A Single Bench of the Bombay High Court held
that that there must be an application made by the judgment creditor for
the said provision to commence. This is in line with the sequence under
Order XXI Rules 46 and 46A of the CPC as stated above. Union of India v.
Jyoti Chit Funds 6 dealt with the issue of locus standi of the Union of
India to challenge the attachment of the specific provident funds and
pensionary benefits; this issue is not relevant in the present factual
conspectus.
1969 39 Comp Cas 595
6 (1976) 3 SCC 607
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Conclusion
36. We do not find any ground to interfere with the impugned order
dated 31.12.2025 dismissing the appellant's application (C.E.A. No 92 of
2025 in C.E.P. No 14 of 2025). The Commercial Court correctly
confirmed the order dated 03.03.2025 in CEP No.14 of 2025 filed by the
respondent No.1 for attachment of the account furnished by the
appellant/Judgment Debtor as valid and rejected the objections raised
by the appellant as untenable. We, hence, find the Appeal to be devoid of
merit.
37. COMCA No.7 of 2026, along with all connected applications, is
accordingly dismissed. There shall be no order as to costs.
_____________________________________
MOUSHUMI BHATTACHARYA, J
_____________________________
GADI PRAVEEN KUMAR, J
DATE: 10.04.2026
TJMR/BMS/VA
