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Telangana High Court
Kanolla Shravan vs M/S. Shriram Chits India Pvt. Ltd. on 21 March, 2025
Author: K. Lakshman
Bench: K. Lakshman
HON'BLE SRI JUSTICE K. LAKSHMAN
CIVIL REVISION PETITION No.933 of 2025
ORDER:
Heard learned counsel for the petitioners and
Sri K.S.Sai Pavan, learned counsel for the respondent
No.1. Perused the record.
2. This Civil Revision Petition is filed under Section
115 of C.P.C. challenging the attachment order, dated
21.03.2024 in E.P.No.65 of 2024 in ARB.No.1631 of 2021
by the Principal Junior Civil Judge at Karimnagar.
3. Respondent No.3 is the subscriber of the Chit and
petitioners and respondent Nos.4 to 6 are the guarantors
to the subject Chit. Respondent No.1 has filed an
application under Section 64 of the Chit Funds Act, 1982
(for short ‘the Act, 1982’) vide ARB.No.1631 of 2021
before the Chit Arbitrator/Deputy Registrar of Chits,
Karimnagar, claiming an amount of Rs.19,26,504/- along
with interest from the petitioners and respondent Nos.4
to 6. Learned Chit Arbitrator has passed an award, dated
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17.04.2023 holding that the petitioners and respondent
Nos.3 to 6 are jointly and severally liable to pay the said
amount i.e., Rs.19,26,504/- with interest @ 18% p.a. on
the principal amount of Rs.16,96,920/- from the date of
filing of dispute to till the date of realization of the said
amount.
4. Thereafter, respondent No.1 has filed an execution
petition vide E.P.No.65 of 2024 in ARB No.1631 of 2021
under Order XXI Rule 11 of C.P.C for realization of the
awarded amount including interest. Vide impugned
salary attachment orders, both dated 21.03.2024, the
Executing Court directed the Salary Disbursement
Officers of the petitioners/J.Dr.Nos.3 and 4 to withheld
an amount of Rs.23,85,692/- from the salary of the
petitioners and remit to the account of the aforesaid
Execution Petition of the Executing Court. Challenging
the said attachment orders, the petitioners filed present
Civil Revision Petition.
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5. It is relevant to extract Order – XXI, Rules – 11 (2) and
48 of the CPC and the same is as under:
“XXI Rule 11 (2) of CPC-Written application- Save
as otherwise provided by sub-rule(1), every
application for the 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;
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(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 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
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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 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.
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(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.”
6. It is also 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.”
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7. 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 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
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of the whole debt, or of that part of it which remains
unpaid by the principal debtor.”
8. From the above, it thus becomes clear that liability of
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.
9. The aforesaid relevant provisions would reveal that for
realization of the amount covered under the subject
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.65 of 2024.
10. In Punyamurthula Venkata Viswa Sundara Rao (1
supra), the Division Bench of this Court on consideration
1
. 2017 (3) ALT 82 (D.B.)
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of the arguments advanced 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.
11. 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 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
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them. 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.
12. In Madamanchi Anill Kumar v. Margadarshi Chit
Fund Pvt. Limited 2, a 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
the 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.
2
. C.R.P. No.2338 of 2018, decided on 05.11.2018
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13. On consideration of the aforesaid provisions and on
examination of the facts of the case therein, in Sri Bandi
Chandra Hari3, this Court held that the decree-holder
cannot recover double the awarded amount from the
judgment debtors, and it is entitled for the decretal
amount and interest as claimed by it from the judgment
debtors.
14. As discussed supra, learned Executing Court has
issued impugned salary attachment orders, both dated
21.03.2024 directing disbursing Officers of
petitioners/J.D.R.Nos.3 and 4 to withhold the entire
amount covered under the said award each from the
petitioners/J.D.R.Nos.3 and 4, remitted the said amount
to the account of the Executing Court. Thus, virtually,
the Executing Court is recovering the total awarded
amount each from the petitioners/J.D.R.Nos.3 and 4.
The same is impermissible. The same is in violation of the
procedure laid down under the Contract Act, Chit Funds
Act and also the principle laid down by this Court in the
3
C.R.P.No.1237 of 2024, decided on 03.05.2024
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aforesaid Judgments. Therefore, the impugned orders are
liable to be set aside and it is accordingly set aside.
15. It is also relevant to note that Section 60 of C.P.C.
deals with the property liable to attachment and sale in
execution of decree. Section 60(i) and (ia) of C.P.C. is relevant
and the same are extracted hereunder:
“i) salary to the extent of [the first [one thousand
rupees]] and two third of the remainder] [in execution
of any decree other than a decree for maintenance]:
[Provided that where any part of such portion
of the salary as is liable to attachment has been
under attachment, whether continuously or
intermittently, for a total period of twenty-four
months, such portion shall be exempt from
attachment until the expiry of a further period of
twelve months, and, where such attachment has
been made in execution of one and the same decree,
shall, after the attachment has continued for a total
period of twenty-four months, be finally exempt from
attachment in execution of that decree]].
(ia) one-third of the salary in execution of any decree
for maintenance.”
16. In the light of the same, on recovery of the entire
awarded amount along with interest and pendente lite
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interest, either the executing Court on its own or on the full
satisfaction memo filed by respondent No.1/DHr, the
executing Court can terminate the E.P. proceedings. There
is no clarity with regard to the same in the impugned orders
both dated 21.03.2024.
17. During the course of hearing, learned counsel
appearing for respondent No.1 failed to get instructions
from respondent No.1 with regard to the same.
18. Accordingly, the C.R.P. is allowed setting aside the
impugned salary attachment orders, both dated
21.03.2024 in E.P.No.65 of 2024 in ARB.No.1631 of 2021
passed by the Principal Junior Civil Judge at Karimnagar
and the matter is remanded back to the Executing Court
with a direction to consider the aforesaid aspects, decide
the Execution Petition strictly in accordance with the
procedure laid down under the Contract Act and also the
principle laid down by this Court vide order, dated
03.05.2024 in C.R.P.No.1237 of 2024 and also the
aforesaid Judgments. No costs.
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As a sequel, the miscellaneous petitions, if any,
pending in this Civil Revision Petition shall stand closed.
____________________
K. LAKSHMAN, J
March 21, 2025
ssm
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203
HON’BLE SRI JUSTICE K. LAKSHMAN
CIVIL REVISION PETITION No.933 of 2025
March 21, 2025
ssm
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