Whether judgment debtor can claim exemption as per S 60(1)(c) of CPC in respect of property over which charge has been created by compromise decree?

According to the learned counsel for the appellant, she is a labourer occupying the land and building shown in the decree, as her sole shelter and source of means and therefore under S. 60(1)(c) of the Code, those assets are to be exempted from sale. On the other hand, according to the learned counsel for respondents 1 and 2, plea for exemption under S. 60(1)(c) does not accrue to the appellant having regard to the nature of decree in execution of which the property in question was sold. The argument is that the compromise decree passed on 11.02.2012 created a charge in the property and therefore, sale was not hit by S. 60(1)(c) of the Code.

11. We perused the decree and the terms of compromise incorporated therewith. The decree shows that the suit was instituted for specific performance of a contract for sale and the 2nd respondent later relinquished his claim for specific performance upon the promise made by the defendant that he would refund ` 75,000/- within six months of the date of compromise with 6% interest per annum. It was also agreed by the deceased Mylan that in case of default of payment of the amount as agreed, there shall be a charge in the plaint scheduled property. There is no dispute that the property brought for sale and confirmed in the execution proceedings was the same property over which charge was created as per compromise. Therefore the question that arises for consideration is whether exemption provided in S. 60(1)(c) of the Code can be claimed by the appellant in respect of the property over which charge has been created by a compromise decree.

12. Section 60(1)(c) of the Code enumerates the properties which are liable to attachment and sale in execution of a decree whereas proviso thereto categorises properties which are exempt from attachment or sale. On assimilation of the entire scheme of the provisions and also the object for which the exemption is enacted, it is very difficult to assume that a judgment debtor who suffers a money decree which creates a charge over his property can claim the benefit of exemption under S. 60(1)(c).

13. The nature of decree charging payment of money in the property of a defendant in a suit for money is such that the right of the holder of decree to recover money from the property by sale is determined at the time of passing the decree. Therefore the objection to attachability or saleability of property bearing charge cannot be said to be a matter arising before a court executing the decree. This is notwithstanding the fact that there is no need for the holder of such a charged decree to seek attachment of property which is already subject to charge since charge always runs with the land irrespective of subsequent transfers. In any view of the matter, a debtor after having created by his own consent a charge in his property cannot be allowed to turn round and contend later that the property is immune from attachment or sale as if he is entitled to exemption under S. 60(1)(c) of the Code. If he is allowed to approbate and reprobate, it will only defeat the very purpose of a decree creating charge in the property. There is nothing in law to indicate that S. 100 of the Transfer of Property Act 1882 (for short 'the T.P. Act') which makes provision for creating charge in the property by act of parties or decree is subservient to S. 60 of the Code. Where a decree orders payment of money and charges it on the immovable property on default, law permits the holder to realise money by sale of property in execution of that decree. This position of law is clear from Order XXXIV Rule 15(2) of C.P.C.

[(2) Where a decree orders payment of money and charges it on immovable property on default of payment, the amount may be realised by sale of that property in execution of that decree.]

IN THE HIGH COURT OF KERALA

F.A.O. No. 210 of 2018

Decided On: 28.06.2019

 Ammini  Vs. Vibeesh

Hon'ble Judges/Coram:

A. Hariprasad and T.V. Anilkumar, JJ.

Citation: AIR 2019 kerala 146

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Provisions of Sarfaesi Act is not applicable in following cases

31. Provisions of Sarfaesi Act not to apply in certain cases.—The provisions of this Act shall not apply to—

(a) a lien on any goods, money or security given by or under the Indian Contract Act, 1872 (9 of 1872) or the Sale of Goods Act, 1930 (3 of 1930) or any other law for the time being in force;

(b) a pledge of movables within the meaning of Section 172 of the Indian Contract Act, 1872 (9 of 1872);

(c) creation of any security in any aircraft as defined in clause (1) of Section 2 of the Aircraft Act, 1934 (24 of 1934);

(d) creation of security interest in any vessel as defined in clause (55) of Section 3 of the Merchant Shipping Act, 1958 (44 of 1958);

(e) 183[* * *]

(f) any rights of unpaid seller under Section 47 of the Sale of Goods Act, 1930 (3 of 1930);

(g) 184[any properties not liable to attachment (excluding the properties specifically charged with the debt recoverable under this Act)] or sale under the first proviso to sub-section (1) of Section 60 of the Code of Civil Procedure, 1908 (5 of 1908);

(h) any security interest for securing repayment of any financial asset not exceeding one lakh rupees;

(i) any security interest created in agricultural land;

(j) any case in which the amount due is less than twenty per cent of the principal amount and interest thereon.

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Supreme Court: Court can not attach pension and gratuity amount even after converted to cash

We also agree with Ms. Shobha that the High Court could not have gone behind the decree in the execution proceedings and the alteration in the manner of recovery of the decretal amount was erroneous and cannot be sustained. We also agree with Ms. Shobha that even after the retiral benefits, such as pension and gratuity, had been received by the appellant, they did not lose their character and continued to be covered by proviso (g) to Section 60(1) of the Code. Except for the decision in the Jyoti Chit Fund and Finance case (supra), where a contrary view was taken, the consistent view taken thereafter support the contention that merely because of the fact that gratuity and pensionary benefits had been received by the appellant in cash, it could no longer be identified as such retiral benefits paid to the appellant.

Supreme Court of India

Radhey Shyam Gupta vs Punjab National Bank & Anr on 4 November, 2008

Bench: Altamas Kabir, Markandey Katju

Citation:(2009)1SCC376                                                                              

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Whether court can permit attachment of pension amount in execution of decree?

 It is well settled that attachment of pension amount cannot be

made for realization of any outstanding.  In this aspect, the above decision

of the Apex Court relied on by the learned Counsel appearing for the

petitioner can be usefully quoted, wherein, in paragraph No.33, the Supreme

Court has observed that the pension and gratuity amount should not attached

under the provision of the Code of Civil Procedure. Paragraph No.33 reads as

follows:-

        33. However, we are also of the view that having regard to proviso (g)

to Section 60(1) of the Code, the High Court committed a jurisdictional error

in directing that a portion of the decretal amount be satisfied from the

fixed deposit receipts of the appellant held by the Bank. The High Court also

erred in placing the onus on the appellant to produce the Matador in question

for being auctioned for recovery of the decretal dues. In other words, the

High Court erred in altering the decree of the trial Court in it revisional

jurisdiction, particularly, when the pension and gratuity of the appellant,

which had been converted into fixed deposits, could not be attached under the

provisions of the Code of Civil Procedure. The decision in Jyothi Chit Fund

case has been considerably watered down by later decision which have been 

indicated in para 22 hereinbefore and it has been held that gratuity payable

would not be liable to attachment for satisfaction of a court decree in view

of proviso (g) to Section 60(1) of the Code.?

                7.      Therefore, if there is any outstanding due payable by the

petitioner, it is for the respondents bank to work out their remedy to

recover the said amount, in the manner known to and permissible by law,

before the appropriate forum.  Without doing so, resorting to attach the

pension amount by way of passing the impugned order is impermissible. 

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT               

DATED : 27.11.2015  

CORAM   

 MR.JUSTICE K.RAVICHANDRABAABU               

W.P.(MD)No.17838 of 2015   

and 

M.P.(MD).No.1 of 2015 

A.Muthuiruvakkal    Vs.The State Bank of India,

  

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Whether salary of husband can attached for recovery of maintenance allowance granted to wife?

Both the learned counsel arguing the case before me then urged a yet another point pertaining to the interpretation of S. 421(1) of Code of Criminal Procedure. Pointing out that the aforesaid sub-section has said, "when an offender has been sentenced to pay a fine, the Court passing sentence may take action for recovery of a fine, in either or both of the following ways." Emphasis was led on the word "may take action". It was submitted, quite with force, that the provisions contained in this sub-section were not restrictive provisions, but they were enabling provisions. It was, therefore, submitted that, even if a restricted interpretation was put on clause (a) of the said section, the section itself did not bar the jurisdiction of the Court to recover the amount of fine in ways other than the two ways enumerated in the section. Sub-section (1) enables the Criminal Courts to recover the levy of fine in two ways specified in clauses (a) and (b) of the said sub-section leaving it open to the Courts also to adopt other legal measures for levying of the fines. In that context also, reference was again made to the provisions contained in S. 83 of the Code of Criminal Procedure by submitting that the mode indicated in Ss. 83(3) and 83(4) both read with S. 85(2) could be used for attachment and sale of intangible moveable assets of a person liable to pay the amount which was leviable as fine. This contention also contains a good deal of force.
When a money lender or a Bank has got the right to attach the salary or an official to the extent indicated therein in execution of the money decree or maintenance decree, it is preposterous to say that a wife cannot seek for attachment of her husband's salary for recovering the arrears of maintenance granted by the Magistrate under S. 125(3). A wife who is entitled to maintenance under S. 125, Cr.P.C. and who is also entitled to recover the arrears under S. 125(3), cannot be placed worst than a money lender. What is available under S. 60, C.P.C. for a maintenance decree-holder, can also be made available under S. 125(3), Cr.P.C. for the recovery of arrears of maintenance."

Bombay High Court

Bhagwat Baburao Gaikwad And ... vs Baburao Bhaiyya Gaikwad And ... on 28 September, 1993

Equivalent citations: 1994 (2) BomCR 695, 1994 CriLJ 2393, II (1994) DMC 195

Bench: M Vaidya

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