Company v. Solanki Tradersr, u

Counsel for the Petitioners: SRI P PANDU RANGA REDDY Counsel for the RespondentNo.l: SRI C V BHANOJI RAMARS The Court made the following: ORDER IN THE IIIGH COURT FOR THE STATE OF TEI ANGANA AT HYDERABAD THE HONOURABLE SMT. JUSTICE RENUI A YARA CML REVISION PETITION No.540 <tl 024 I l'r'DAY oF DECEMBER, 2025 Between: Mis. Siddhu lndustries and another. M/s. Southern Minerals ar-rd (lhernicals and another. AND ORDt)R: ...Petitioners ... Respo nden ts Fleard Sri P. Pandu ltanga Reddy, leamed couns€ for the revision petitioners and Sri C V Bhanoji Ramars, learned counserl tr the respondent No. t.

2. The Civil I{evision Petition is fited by the pet r oners/respondent Nos.l and 2 aggrieved by the order dated 05.12.2023 par,r :d by the leamed III Additional District and Sessions Judge, Medchal-Mz J rajgiri District at Kukatpally. ('trial Courr'.1 in I.A.No.503 ol 2023 in u. ,.No.61 of 2022, wherein a petition filed under Order XXXVIII Rule 5 rf CPC, seeking atLachment of amount of Rs.51,44,49 4l- lying with respor lent No.2 herein, has been allowed issuing a prohibitory order directing respondent No.2 herein to withhold the amount due to petilioners from res I rndent No.2. RY,J cRP 540 2024

3. Initially, respondent No.r rrerein fired suit for recovery of a,rount of Rs.49,44,2941- from the petitioners herein. It is the case of respondent No.l that it is a supplier of lerric alum to the petitioners and in that context have provided credit basis during the period from lo.o4.2o2o to 21.1 l.2ozo. Respondent No.1 clairns that the running account of the petitioners lor an amount of Rs.49,44,294l- is outstanding. As per custom, usage and trade practice the pctitioners are liable to pay the outstaniling amount ol Rs.49,44,2941- wi{.h interest aI24Yo per annum. The petitioners ha,.,e issued cheque bearing No.13028 t dated 29.01 .2022 for an amounr ol' Rs.49,44,2941- drawn on Vijaya Bank, Karimnagar branch, torvards discharge of the outstanding amount. The said cheque was presented for realization on 31.01.2022. Petitioners have issued another cheque bearing No. 110282 dated 3l.Ol.2022lor Rs.18,24,253.971- dravtnon Vijaya Bank, Karimnagar branch, towards interest. amount. When cheque bearing No.130281 dated 29.0i.2022 issued by petitioner No. I was presented to HDFC Bank, Petbasheerabad branch, Hyderabad, the same was returned with reason 'unpaid as bank merged'. This situation according to respondent No.l showed fraudulent and dishonest intention of the petitioners. Upon bouncing of cheque, respondent No.1 got a legal notice issued on 21.02.2022 with the particulars and demanded payment. The petitioners have issued a reply notice with false allegations, adrnitting =\ 2 "/ RY,J cRP 540 20?4 liability to pay only Rs.29,04,809/- as due. The bills of ie petitioners are with respondent No.2 and in case said amounts are pai J to the petitioners there is every likelihood that respondent No.1 would rr 't realize the suit amount. Ther:eforc, rvhile filing the suit fbr recovery ol z r rount a petition is filed under Order XXXVIII Rule 5 of CPC to give dire: ion to respondent No.2 to withhold the amount due and payable to the pelili ,ners.

4. The petitioners have filed counter denying the ,: se of respondent No. l, more particularly stating that no details are gir,: r with respect to liability of Rs.49,44,2941- and intelest of Rs. 18,24,253.'71-.It is pleaded that no reasoning is given for seeking huge amorr. t of interest of Rs.18,24,253.97/-. The petitioners denied liability to pl the suit amount to respondent No.l . Further, it is pleaded that lour blanl rl'reques are given to respondent No.1 with a clear mention about prLr; rase ot.der dated

02.09.2020 and the cheques were given only for the p-r pose of security, whereas said cheques were used with a dishonest mo i ,e and mala fide intention. The cheques are misused by filling up ruge amount of ks.49,44,294/- and got them returned with the endorsem: rt ,bank merged,. It is the case of petitioners that respondent No.l faile I to supply total quantity of 1270 metric tons of ferric alum and therr is late supply of meager quantity of 53.4 metric tons out of 1270 metr ( tons and due to 3 RY,J cRP 540 2024 failure of supply of remaining quantity of 816.6 metric tons of fenic alum, the govemment stopped the cheques and bracklisted petitioner No.1. In this context, petitioner No. 1 is planning to initiate pr.oceedings for damages against respondent No.l. lt is the case ol'the petitioners that respondent No.1 failed to perlorm its contractual obligation as per order dated

02.09.2020 and therefbre, the petitioners have demanded respondent No.l to retum four cheques, which were given towards security deposit. In the aforementioned context, the petitioners pleaded that there is no cause of action fbr flling the suit, as such prayed to disrniss the petition. 5 The learned trial Courl considered the case of both the partics and came to a conclusion that in case the alnount is withheld with respondent No.2, respondent No.l rvould not have any problern and the money would be secured for the purpose of realizing the amount by respondent No. I in case ofthe suit being decreed. Furlher, it is held that there is an issue about liability of the petitioners at Rs.49,44 ,2941- as claimed by respondent No.I or Rs.29,04,809/- as claimed by the petitioners and it is held that said issue cannot be decided within the purview of the interlocutory proceedings under Order XXXVIII Rule 5 of CPC. It is also held that respondenr No.2 opposed attachment of amount on the ground that in case the attachment is made the petitioners would not be able to complete the work and the same \_, \ 4 z'' RY,J cRP 540 2024 would result in loss to respondent No.2. In this case, it i held that there is no need for giving attachment to bring the amount to I re Court and it is sufficient in case a prohibitory ordel is given. In tht rackdrop of such reasoning, a prohibitory order was given directing r c ri;ondent No.2 to withhold the amount due to the petitioners. Aggrievcri ry the said order, the present revision is pref-erred.

6. In the grounds of revision, it is pleaded that Orc{,: XXXVIII Rule 5 ol CPC is a drastic and extraordinary power ri,hich c: rnot be exercised merely for the asking. It is pleaded that there are no gro.r rds to believe that the petitioners are delaying or obstructing the passing ol udgment. Further, it is pleaded that except for making a vague claim aboL the amounts due by the petitioners, respondent No.1 did not produce bil ; of the rnaterials delivered and the amounts claimed to be due. No reli: is sought by the respondent No.1 against respondent No.2 and therefore. r prohibitory order could not have been issued. According to the petitioner , no relief can be granted against respondent No.2 and therefore, no permis ,ible interim relief can be granted. Lastly, it is pleaded that the trial Court as no jurisdiction to issue prohibitory orders by way of interim relief.

7. In support of the revision petition, the leamed corrr sel for petitioners \as relied upon judgment between Raman Tech and prr ccss Engineering 5 -a.. RY,J I-] cRP 540 2024 Company v. Solanki Tradersr, u4rerein it is held that when the documents produced in support of the case do not satisfu the existence of prima facie case, the Coun will not go to the next stage of examining rvhether the interest of plaintiff should be pr.otected by exercising the power under Order XXXVIII Rule 5 of CPC. Furlher. reliance is placed on rhe judgment of Sreepathi Pandita Rajula Venkata Babu v, M/s.Varalaxmi Finance Corporation 2, wherein it is held that the order passed under Order XXXVIII Rule 6 ol CI)C as a tlnal ordcr of attachmcnt of propcrty belbre judgment in the suit. Ordcr XXXVIII l{ule 5 of CPCI provides rhat an order of attachment made under Oldcr XXXVIII Rulc 6 ol CPC, without complying with provisions of sub-Rule I is void. When a petition is filed for attachment before judgment, thc first step is to ca[[ upon the defendant to fumish security. Only when the defendant fails to furnish security and also lails to show causc as to rvlty he could not furnish security, attachlnent is to be ordered.

8. When the case of respondent No.l is examined in the backdrop of the judgments relied upon, it is seen that there was a running account with outstanding balance of Rs.49,44,294/- for the transactions between the period 10.04.2022 and 21.11.2022. The said amounts in spite of demand ' 1zooa1 z scc :oz 'oegs (r)arr zs: (o.s.) 6 RY.J cRP s40_2021 by respondent No.1 were not paid. When a legal ntr ce was issued on

21.02.2022, on 01.02.2022, a reply notice is issued al nitting liability of Rs.29.04,809/-, but not the remaining arnount. Accorr ing to respondent No.l, the petitioneLs are deliberately avoiding payrnent , 1' the due amounts and interest. There is avoidance on the pretext of the rills pending with respondent No., and that the bills ol- respondent No.I ..vould be cleared onlr when lespondent No.2 pays the bitts to thc petiri rners. This reason citr'd fbr non-payrnent caused apprehension about the f t itioners'intention to aroid paylnent olhuge amount and thcrefore, attacltnr nt is soueht.

9. Respondent No. t has prima facie shown his crr c for recovery ol' arnount of Rs.49,44,494l- by filing the statement of srrJ,l Iies and payments given by petitioner No.1. Further, the reply norice sho\!, acknowledgment ol liabilitl, and the part of the petitioners to pay Rs.2,) 14,809/-. Though, there is discrepancy about the amounts due, the 1-act thl t the petitioners are liable to pay at least Rs.30,00,000/- is cstablished. 'fhert.: rre, complete lack of prima facie case on the part of respondent No.J. rs alleged by the petit"ioners, is not sustainable. Further, when the petition rrs are linking the payment of amounts due to respondent No. I with p i r'ments due from respondent No.2, the only way available for the pt t tioners to secure pavnlent ol their amount is to seck attachment ol' amounts due by 7 ,,, RY,J N. cR? 540 2024 .fl respondent No.2 to the petitioners. By weighing the pros and cons olboth the parties, the learned trial Court issued prohibitory order directing respondent No.2 to withhold the amount due to rcspondent Nos.1 and 2 to the petitioners by respondent No.2.

10. In view of the loregoing discussion, this Court does not see any reason to interfere with the finding of the trial Court in passing the prohibitory order. There are no grounds to interlerc with the impugned order and the Civil Revision petition lacks merits and is liable to be dismissed. I1. In the result, the Civil Revision Petition is dismissed confinning the order dated 05.12.2023 passed by the trial Courl in I.A.No.503 of 2023 in O.S.No.61 of 2022. There shal[ be no older as to costs. Miscellaneous applications, if any, pending shall stand closed. SD/- L. VIJAYA LAXMI SISTANT REGIST /ITRUE COPY// SECTION OFFICER To,

1. The lll Additional District and sessions Judge-cum-ll Additional Metropolitan ' sli"Jiii,iiiioge-cum-Fiincipar Famity Couft, Medchal Malkajigiri District at KukatPallY

2. One CC to SRI P PANDU RANGA REDDY Advocate [OPUC] 3. One CC to SRI C V BHANOJI RAMARS Advocate [OPUC] 4. Two CD CoPies VM/PSL F{- HIGH COURT DATED: 1111212025 ORDER CRP.No.540 ol 2024 ,i) o T * oR C A, c, 2B I l)t]? * e4 : :.rr' DISMISSING THE CIVIL REVISION PETITION .oe?"A G trr"