DHARAMRAJ CONTRACT INDIA PRIVATE LIMITED v. ENPEECOM

1. Petitioner is plaintiff before the learned Trial Court and is aggrieved by order dated 16.07.2024 whereby he has been directed to submit a bank guarantee in a sum of Rs. 60 lacs in the name of the Court.

2. The application moved by the defendant was a composite one as it was moved under Order XXXIX Rule 10 CPC as well as under Order XXXVIII Rule 5 CPC.

3. However, evidently, the order has been passed by the Court while invoking its power under Order XXXVIII Rule 5 CPC. It becomes manifest from the bare perusal of Para-10 and Para-11 of the impugned order. CM(M) 3617/2024 2

4. Admittedly, plaintiff seeks recovery of Rs. 1,12,20,910/-. It seems that in terms of admission made in the written statement, the defendant had admitted its liability to the tune of Rs. 41,12,722/-, being due and on the basis of such categorical admission, learned Trial Court had, even, passed a ‘partial decree’ in favour of the plaintiff and against the defendant.

5. During course of the arguments, it was also apprised that such amount has already been duly paid to the plaintiff.

6. Besides the above, there was no other admission made in the written statement qua the balance amount and learned Trial Court has ordered ‘attachment before judgment‟ by directing the defendant to submit bank guarantee while observing as under in Para-10 and Para-11.

10. Ld. counsel for the plaintiff has very vehemently argued that there is every likelihood that the defendant will wind up and start operating in the name of some other company and in that eventuality, the plaintiff would be left high-and-dry, even after getting a decree in its favour. It is very vociferously contended that the defendant has made clear admission about delivery of goods through invoices and has not even raised any deficiency in the material and the only dispute which has been raised is with regard to some variation in the price of diesel and cement during the aforesaid period of 22 months.

11. In my considered opinion, there appears to be force in the argument of Ld. Counsel for the plaintiff. The application stands disposed off with direction to the defendant to execute a bank guarantee in the sum of Rs.60,00,000/- (Rupees sixty lacs only) in the name of this court within four weeks from today.

7. It will be equally important to see the averments made in this regard in the application.

8. There is only one paragraph which can be said to be having any connection that to a remote one with respect to the invocation of powers of the Court under Order XXXVIII Rule 5 CPC. Such paragraph reads as under: - “That to meet the ends of justice & to secure the rights and claims of the CM(M) 3617/2024 3 plaintiff. It has become imperative that the amount claimed by the plaintiff in the present case be deposited before this Hon‟ble Court by the defendant, after adjusting the paid amount of Rs. 41,12,722/- under the provisions of Order XXXIX Rule 10 CPC or in the alternative, the Defendant through its Managing Director/Directors be directed to furnish the details of its assets including the immovable and movable properties and bank accounts, deposits, etc. in terms of Order XXI Rule 41 CPC r/w FOR No. 16A in Appendix-E and to attach the said properties as a security to the tune amount claimed by the plaintiff in the present case, in terms of provisions of Order XXXVIII Rule 5 CPC.”

9. In the rest of averments made in the above application, there is nothing at all which may indicate that the defendant, with intent to delay or to avoid any process of Court or to obstruct or delay the execution of any decree that may be passed against him, has either absconded or left the local limits of the jurisdiction of the Court or about to abscond or has disposed of or removed from the local limits of the jurisdiction of the Court his properties or any part thereof.

10. What has been mentioned in the order is indicative of the fact that defendants are about to wind up its business but as noted already, nothing of that sort has even been whispered in the application under disposal.

11. It seems that merely on basis of oral submissions made during the course of arguments, learned Trial Court got swayed away and have passed such an order.

12. Needless to emphasize that the provision prescribed under Order XXXVIII Rule 5 CPC is a drastic one and has to be resorted to with utmost care and caution. The application moved in this regard does not even contain any averment which may indicate any such act or conduct on the part of the concerned defendant, necessitating passing of any order for „attachment before judgment‟. There must be positive, definite and discernible material for CM(M) 3617/2024 4 invocation of such extraordinary power. Court is required to accord its due satisfaction and such order cannot be passed on mere verbal assertion. Unfortunately, in the instant case, there was no material requiring exercising such power.

13. This Court is also conscious of the fact that an appeal would lie against an order passed under Order XXXIX Rule 10 CPC but a careful perusal of the impugned order clearly goes on to indicate that the order directing submission of bank guarantee has been passed while invoking power under Order XXXVIII Rule 5 CPC.