Jammu & Kashmir High Court
Reserved On 29.07.2025 vs J&K Bank And Another on 1 August, 2025
Author: Moksha Khajuria Kazmi
Bench: Moksha Khajuria Kazmi
HIGH COURT OF JAMMU AND KASHMIR AND LADAKH
AT JAMMU
CM(M) No. 156/2022
Reserved on 29.07.2025
Pronounced on 01.08.2025
J&K Bank Limited and another
Through :- Mr. Raman Sharma Advocate.
V/s
Chander Udey Singh
Through :- Mr. Himanshu Beotra Advocate.
CORAM:
HON'BLE MS. JUSTICE MOKSHA KHAJURIA KAZMI, JUDGE
JUDGMENT
1 By this petition filed under Article 227 of the Constitution of
India, the petitioner seeks the issuance of an appropriate writ, order, or
direction in the nature of certiorari for setting aside the order dated
24.06.2022 passed by the learned Principal District Judge, Jammu, in an
appeal titled Chander Udey Singh vs. J&K Bank and another, whereby the
order dated 27.04.2022 passed by the learned 1st Civil Subordinate Judge
(Municipal Magistrate), Jammu, dismissing the application for interim relief
in the suit titled „Chander Udey Singh vs. J&K Bank and another’was
quashed, and the petitioners-bank were temporarily restrained from
withdrawing or deducting any amount from the pension account of the
respondent/plaintiff.
2
Factual Matrix:
2 The respondent maintains a pension account with the petitioners’
bank. Both the respondent and his wife are suffering from various age-related
ailments. The respondent stood as guarantor for the loan accounts of M/s S.P.
Enterprises and M/s S.L. Telecom proprietary concerns of the respondent‟s
wife, Renu Choudhary. Owing to heavy losses and high interest rates, both
loan accounts became Non-Performing Assets (NPAs).The petitioners have
already filed a civil suit against these firms, which is currently pending.
However, without obtaining any orders from the trial court, the petitioners
unilaterally froze the respondent’s pension account and deducted sums
therefrom, thereby depriving him of pension funds needed for his daily needs
and medical expenses. Consequently, the respondent filed a civil suit seeking
a permanent prohibitory injunction restraining the bank from withdrawing,
transferring, or deducting any amount from his pension account at the
petitioners’ Trikuta Nagar branch.The application for interim relief filed in the
said suit was dismissed by the trial court on 27.04.2022. Being aggrieved by
the said order, the respondent filed an appeal. His primary contention was that
the trial court had failed to consider the legal protections provided under
Section 60 of the CPC and Section 11 of the Pensions Act, 1871. These
provisions prohibit attachment of pension amounts, whether by court order or
otherwise, and thereby impliedly bar even direct deductions by creditors from
such funds. The respondent also pointed out that the petitioners had
admittedly deducted Rs.25,000 from his pension account and had left only
with 50% of his pension for personal expenses. He has argued that such
deductions violated the statutory protections intended to safeguard the
financial security of pensioners. It was further submitted that, although there
are five guarantors in the present case as per the deeds of guarantee, the
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recovery has been effected solely from the respondent, who is only one of the
guarantors.
3 Before the appellate court, the petitioners contended that the suit
was barred under Section 41 of the Specific Relief Act and that the
respondent’s account had not been frozen, but only marked for adjustment
against NPA accounts in which the respondent had stood as guarantor. They
further argued that the deductions were made in accordance with the deeds of
guarantee executed by the respondent, which conferred a lien over all his
securities and monies with the bank.The respondent, in rebuttal, reiterated that
under Section 11 of the Pensions Act and Section 60 of the CPC, pension and
gratuity even if credited into the account retain their character and enjoy
protection from any form of attachment or deduction, as has been held by this
Court in Farooq Ahmed Khan vs. Mehmooda Khan (CRMM 210/2020,
decided on 11.05.2022).
4 The appellate court, after considering the arguments, allowed the
appeal, quashed the trial court‟s order, and restrained the petitioners from
transferring or withdrawing funds from the respondent‟s pension account. The
present petition challenges that order of the appellate Court.
5 Vide order dated 26.12.2022, this Court stayed the operation of
the impugned order dated 24.06.2022 and clarified that the trial court‟s order
dated 27.04.2022 would remain in force. Thereafter, on 21.02.2023, learned
counsel for the respondent submitted that no objections would be filed.
6 Heard learned counsel for the parties and perused the material on
record.
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7 It is submitted by the learned counsel for the petitioners that the
appellate court failed to appreciate that Section 11 of the Pensions Act applies
only where attachment or sequestration is sought through the process of the
court in execution of a decree. In the present case, no such court process was
initiated by the bank. The bank merely enforced the contractual right vested in
it by the deeds of guarantee executed by the respondent. It is submitted that
deeds of guarantee were voluntarily and unequivocally executed by the
respondent. The appellate court erroneously held that acting under such deeds
violates public policy under Section 23 of the Contract Act. The respondent
did not seek any declaratory relief challenging the validity of the deeds. The
court below, therefore, erred in holding the contracts unenforceable without
any such prayer. It is further submitted that Section 60 CPC bars attachment
of pension only in execution of a decree. The present case involves no such
execution. Hence, the said provision is not attracted. The court below wrongly
applied its decision to a situation that involved private contractual rights.
8 It has been submitted that under Section 171 of the Contract Act,
banks enjoy a general lien over funds held by them. In this case, the
respondent had contractually agreed to the exercise of such lien. The appellate
court failed to consider that the lien was not in violation of any statutory bar.
It is further submitted that the injunction granted by the appellate court
violates Section 38, as it restrains enforcement of a lawful obligation arising
from the deeds of guarantee. This virtually cancels the contract and allows the
respondent to avoid his contractual obligation. It has been submitted that the
appellate court erred in holding that pension retains its exempt nature even
after credit to a regular bank account. The Court ignored the specific lien
created under the deeds of guarantee over all funds in the account,
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irrespective of source. In support of his submissions, learned counsel for the
petitioners has relied upon the following case law:
(i) Himachal Pradesh Financial Corporation v. Anil Garg, AIR 2017
SC 1953: “Public policy” must not be misapplied to defeat
legitimate financial obligations.
(ii) State of Jharkhand v. Surendra Kumar Srivastava, AIR 2019 SC
231: Writ petition maintainable against civil court‟s refusal to
grant interim relief.
(iii) Virendra Thakur v. Punjab National Bank, 2013 (Pat): Deduction
from pension account as per loan agreement does not constitute
execution of a decree.
(iv) Mohd. Maqbool Kunash v. J&K Bank Ltd: A borrower cannot
deny the bank‟s lien where an express contract authorizes the
same.
9 Per contra, the maintainability of this petition under Article 227
is questioned by the respondent. The respondent has contended that that the
petition amounts to a second appeal under the guise of supervisory
jurisdiction under Article 227. It is a well-settled principle that the High Court
cannot re-appreciate facts or act as an appellate forum under Article 227. The
impugned order is a reasoned one and does not suffer from any jurisdictional
error warranting interference. In support of his submissions, learned counsel
for the respondent has relied upon the following judgments:
(i) Shalini Shyam Shetty v. Rajendra Shankar Patil, (2010) 8
SCC 329: Jurisdiction under Article 227 is supervisory, not
appellate.
(ii) Chand Devi v. Sonam Choudhary, OWP No. 1856/2018,
decided on 16.05.2023 (J&K High Court): Jurisdiction under
Article 227 cannot be exercised as a matter of routine.
(iii) Ghulam Ahmad Magray v. State of J&K, 2019 AIR J&K
34: Power under Article 227 is to be exercised sparingly.
(iv) Ghulam Mohi-ud-Din Khan v. Abdul Rasheed Khan,
CM(M) No. 183/2021, decided on 17.12.2021: High Court
cannot act as appellate court under Article 227.
(v) Radhey Shyam Gupta v. PNB, AIR 2009 SC 930:
Pensionary benefits do not lose exempt status even when
converted into fixed deposits.
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10 Before proceeding further, it is appropriate to reproduce the
relevant portion of the impugned order passed by the appellate court, which
reads as under:
“Section 11 of the Pension Act 1977 grants exemption of pension
from attachment by enacting a provision that no pension, shall be
seized or attached at the instance of creditor for any demand against
pensioner or any satisfaction of a decree. The aforesaid provision came
up for consideration in AIR 1976 SC 1163, wherein it was contended
that once amount reaches to employee, the same becomes a general
account and gets merged with other assets. Thus, the bank would within
its right to debit such of the amount as it finds necessary for adjustment
of the loan.It was held in that case “Once the pension or gratuity had
been paid tothe concerned employee, they no longer retain their
original character and is amenable to attachment,” The aforesaid
decision came up for consideration in the subsequent matter titled
Radhey Shyam Gupta Vs Punjab Nation Bank & Anr AIR 2009 SC
930.In that case, the bank had laid lien against the pension amount and
gratuity amount which was declined by the executing court on the
ground that it cannot be attached in view of Section 60 of the Code.
The bank filed revision petition before High Court, which was allowed.
Therefore, matter landed before Apex Court. The bank relying upon
the Jyoti Chit Fund case claimed that it had lien over the amount
deposited in the bank. Holding otherwise, the Apex Court in Supra
case held thatWe 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 a 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 pensionery
benefits had been received by the appellant in cash, it could
no longer be identified as such retiral benefits paid to the
appellant.The aforesaid authority was also relied by High Court of
J&K in csse titled Farooq Ahmed Khan vs Mehbooka Khan CRM (M)
210/2020 D.O.D 71.05.22 relating to execution of maintenance
order,wherein the Treasury Officer was directed to stop payment of
pensionand other pensionary benefits to husband till he makes payment
of arrear of maintenance to the respondent.
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The aforesaid legal proposition therefore holds the field that in so far as
the retiral benefits by way of pension are concerned once they are held
by the competent authority into the accounts of the pensions that do not
lose their character and would be continued to be covered by proviso to
Section 60 of the Code which cannot be attached. Once this is the legal
proposition, then how can the bank rely upon the covenant of a deed of
guarantee wherein the guarantor has submitted to the bank to have lien
over his monies. Therefore the trial Court i.e Court of Muncipal
Magistrate Jammu while deciding the case of the parties has fallen in
error treating the amount of pension after being credited in the account
of the respondent herein to loose its colour of pension and bar of
attachment then is removed. This view of the trial Court runs contrary
to the aforesaid legal preposition and the trial Court thereafter fell in
error in reaching to the conclusion that the petitioner herein has failed
to prove a prima facie case. Taking the other view of the matter, the
bank upon the covenants of deed of guarantee dated 06.08.2012 had
argued that it has a lien over the said account because the appellant
having agreed that the monies lying with the bank are liable to be used
towards satisfaction of any liability. Learend counsel laid stress upon
the word „any‟ occurring in clause 9 of the deed of guarantee and
argued that this will include the amount credited by way of pension as
well. As already discussed, once the pension amount is credited to the
pension account, it would not become any other amount but would
continued to be one which would be exempted from attachment and
even the court in exercise of its powers under Section 60 of the Code is
debarred from attaching such amount, so the policy of law under both
the provisions is for exemption of pension amount from attachment.
This is because the object and reasons that led to the enactment of such
provison was that post retiral benefits shall be enjoyed by the retiree for
his own well being and not for any commercial purposes. The
exemption is based on the premise that retirement and pension benefits
are given to a government official to make sure that they have a
constant income for a secured life so that they can have a peaceful
retired life with no hassles whatsoever in terms of finances. So the
object is to secure the life of a retiree which is guaranteed by the
aforesaid provisions. That such pensionary benefits should not be
attached in execution of any decree. Whereas section 23 of the Contract
Act says that the consideration and object of an agreement is lawful
unless it is forbidden by law or is not opposed to public policy. If the
submission of the counsel for the bank that word any account described
in the deed of guarantee would also include the pension account and
the same can also be attached or the bank had lien over it and in case
such a view is acceded to, that would leave to the Court in accepting an
agreement which is opposed to public policy. The action of the bank
8that it has the lien over the pension amount of the respondent herein
(appellant) as well is not recognized by law rather has got to be held to
be forbidden. In case bank is allowed to proceed on that premise that
would make aforesaid two provisions nugatory. In that view of the
matter, trial Court i.e Court of Municipal Magistrate by not granting
interim relief in the nature prayed for has fallen in error thereby
resulting in miscarriage of justice. The appellant-respondent herein
sought injunction against the bank restraining it from deducting,
transferring or withdrawing any amount from the pension account of
the appellant-respondent herein whereas given the nature of
proceedings and stand taken by the appellant-respondent herein,
certainly he had been able to carve out a prima facie case in his favour.
By denying interim relief, the appellant would be put to more loss than
the bank as the appellant is stated to be old and ailing one who requires
pension for his urgent well being. However this does not mean that the
bank has no charge or lien over the other amounts if any credited to the
aforesaid account of appellant, this is because the exemption is
restricted to the extent of money derived by way of pension from the
appropriate authority”.
11 The respondent has raised a objection that the present petition is
not maintainable under Article 227 as it seeks to invoke the supervisory
jurisdiction of this Court against a reasoned and discretionary order passed by
the appellate court, which does not suffer from any jurisdictional error.
12 This Court is conscious of the well-settled legal position with
respect to the scope and limits of supervisory jurisdiction under Article 227 of
the Constitution of India. The Supreme Court, in the landmark judgment of
Shalini Shyam Shetty v. Rajendra Shankar Patil, (2010) 8 SCC 329, has
authoritatively delineated the distinction between the exercise of supervisory
jurisdiction under Article 227 and appellate jurisdiction. It has been
unequivocally held that supervisory jurisdiction is not to be invoked to correct
mere errors of fact or law, however grave they may appear. Article 227 is
intended to ensure that courts and tribunals function within the bounds of their
authority and do not transgress the limits of their jurisdiction. It is not a forum
for reappreciation of evidence or re-evaluation of factual findings.Unless the
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impugned order is shown to suffer from patent illegality, jurisdictional error,
perversity, or results in a manifest failure of justice, the High Court would not
be justified in exercising its supervisory powers. This position has been
consistently reiterated by this Court as well in Chand Devi v. Sonam
Choudhary, OWP No. 1856/2018, and Ghulam Ahmad Magray v. State of
J&K, AIR 2019 J&K 34, where it has been held that the power under Article
227 is to be exercised most sparingly, with circumspection, and only in cases
involving grave injustice or abuse of the process of law.
13 In the present case, the appellate court has passed a detailed and
reasoned order after due consideration of the pleadings and material on
record. The order does not disclose any jurisdictional infirmity or perversity
that would warrant interference in exercise of supervisory jurisdiction. Merely
because another view is possible or that the petitioner is aggrieved by the
conclusion reached by the appellate court, cannot be a ground to invoke
Article 227 of the Constitution. This Court is not sitting in appeal over the
findings recorded by the appellate court nor is it called upon to substitute its
own views in matters involving appreciation of evidence or the exercise of
equitable discretion. In the absence of any exceptional or manifestly unjust
circumstance warranting interference, this Court finds no merit in the petition.
14 The primary contention raised by the respondent is that the
pension credited to his account continues to retain its exempt status by virtue
of Section 11 of the Pensions Act, 1871 and the proviso (g) to Section 60(1)
of the Code of Civil Procedure, 1908. These provisions categorically prohibit
the attachment of pension and gratuity amounts, and this protection, it is
contended, extends even after such benefits have been credited into the
retiree‟s bank account. In support of this proposition, this Court is of the view
10
that the appellate court has rightly placed reliance on the judgment of the
Supreme Court in Radhey Shyam Gupta v. Punjab National Bank, AIR
2009 SC 930, wherein it was authoritatively held that pension and other
retiral benefits do not lose their exempt character upon being deposited into
the pensioner‟s bank account. The Court clarified that the protective cover
remains intact so as to prevent any form of attachment or coercive recovery
from such amounts.The legal position stands further fortified by the decision
of this Court in Farooq Ahmed Khan v. Mehmooda Khan, CRM(M) No.
210/2020, which has affirmed that pension amounts are statutorily insulated
from any coercive recovery measures, including unilateral deductions by
banks. The judgment emphasized the legislative intent to uphold the financial
dignity and independence of retired individuals, recognizing that pension
serves as a substitute for wages and sustains the post-retirement livelihood of
the pensioner.
15 The respondent is an elderly individual who, as per the medical
records placed on file, is suffering from serious health issues. Pensionary
benefits, being the sole means of sustenance for most retired individuals,
acquire heightened significance in such circumstances. The withholding or
deduction of pension funds, particularly when such funds are statutorily
protected, would not only cause financial distress but also amount to a
violation of the respondent’s right to live with dignity. The appellate court,
therefore, rightly observed that denial of interim protection in such a case
would result in grave and irreparable hardship to the respondent, undermining
the very object of the statutory exemption conferred by law. Thus, when
weighed against the irreparable prejudice to the respondent, the temporary
inconvenience to the bank if any does not tilt the balance of convenience in its
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favour.In this context, the appellate court has appropriately exercised its
discretion in favour of the respondent by restraining the bank from making
further deductions from the pension account. This balanced approach upholds
both statutory protections and the legitimate interests of financial institutions,
thereby achieving a just and equitable resolution of the matter at the
interlocutory stage.
16 In light of the detailed discussion hereinabove, this Court is of
the considered opinion that the impugned order passed by the learned
appellate court is legally sound and does not suffer from any jurisdictional
infirmity, procedural impropriety, or perversity warranting interference in the
exercise of supervisory jurisdiction under Article 227 of the Constitution of
India. The appellate court has correctly appreciated the legal and factual
matrix, and its conclusions are in consonance with binding judicial
precedents, the statutory framework governing pensionary protections, aimed
at safeguarding the financial dignity of retired individuals. The impugned
order does not disclose any error of law or fact that would justify invocation
of the extraordinary and discretionary jurisdiction of this Court. On the
contrary, the appellate court‟s reasoning demonstrates a careful balancing of
statutory rights and equitable considerations. The challenge laid to the order
is, in substance, an impermissible attempt to reappreciate evidence and
reinterpret settled legal principles through the vehicle of a petition under
Article 227, which is not designed to function as a substitute for an appeal.
17 Accordingly, this petition is dismissed. As a consequence, the
interim order dated 26.12.2022 passed by this Court is vacated. However, the
interim protection granted by the appellate court in favour of the respondent
shall continue to remain in operation. It is made explicitly clear that the
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observations made herein, as well as those recorded by the learned appellate
court, are confined to the adjudication of the question of interim relief. The
same shall not, in any manner, prejudice or influence the learned trial court,
which shall proceed with the suit strictly on its own merits and in accordance
with law, uninfluenced by any prima facie findings recorded either by this
Court or by the appellate court at the interlocutory stage.
(MOKSHA KHAJURIA KAZMI)
JUDGE
Jammu
01.08.2025.
Sanjeev
Whether approved for judgment: Yes/No