Praveeen Shenoi vs State Bank of India

Thottathil B. Radhakrishnan, J.—These appeals are filed against orders dismissing applications filed under Order XXXVII R. 8 read with S. 151 C.P.C. The plaintiff in O.S. No. 474 of 2009 of the Additional Sub Court, Irinjalakuda obtained an order of attachment before judgment on 15.11.2009. The appellants filed two claim petitions on 4.10.2010 pleading that they are the purchasers of the property under attachment as per two sale deeds executed by the defendants on 18.7.2009. The suit was decreed on 29.10.2010 and the claim petitions were dismissed on 22.2.2012 holding that the claim petitions are not maintainable in view of the decree passed in the suit. The dismissal of the claim petitions were without prejudice to the claim petitioners filing such petitions before the executing court.

The learned counsel for the appellants argued that though Joy Vs. Cherukutty and Another may be authority for the proposition that an attachment cannot be lifted in the trial side once the suit is decreed, the applications which were filed as claim petitions were pending on the date of decree and therefore, they ought to have been treated as applications filed in execution. Reference was made to the decision of the Andhra Pradesh High Court in J. Rama Murthy and Others Vs. Srinivas Corporation General Merchants and Commission Agents and Others, . He also argued that in Rajan alias Rajan Gopinathan Vs. Dr. D. Jayashree Nayar and Leela, , distinction has been drawn as to the quality of adjudication when request for lifting attachment is made on the trial side and claim petitions are filed in execution.

Per contra, the learned counsel for the decree holder bank argued that the assignments held out by the appellants are transfers in defraud of creditors and even if the applications were to be entertained, adjudication on that issue had also to be had, because by the time the applications were taken up for consideration finally, the suit stood decreed.

The suit was decreed on 29.10.2010. The applications which were filed as claim petitions invoking Order XXXVIII R. 8 were pending as on that date. The impugned common order is issued on 22.2.2012.

An order of attachment before judgment will continue to operate even after decree. This means that the questions referable to any claim as against the property under attachment can be considered after the passing of the decree only in the execution side. Decree having been passed, such an adjudication would necessarily be one which would include all questions arising between the parties to the proceedings or their representatives, including questions relating to right, title or interest in the property attached. Therefore, the applications filed under Order XXXVIII R. 8 could have been treated as applications on the execution side requiring adjudication in terms of Order XXI R. 58 of the Code. We are in agreement with the decision in J. Rama Murthy (supra).

As the applications could not have been decided upon by the court below in the trial side after passing the decree, the distinction drawn by the Division Bench in Rajan (supra) is not relevant for the purpose of this case.

Resultantly, the impugned common order has to be set aside paving way for the court below to consider the applications filed by the appellants under Order XXXVIII R. 8 as applications in execution, to be proceeded with as enjoined by the relevant provisions of Order XXI R. 58 of C.P.C.

In the result, these appeals are allowed setting aside the impugned order and directing that the court below shall treat the interlocutory applications from which these appeals arise as applications filed on the execution side and would number them appropriately and proceed with adjudication in terms of Order XXI R. 58 of C.P.C. No costs.