Union of India v. Amitava Paul
Case Details
IN THE HIGH COURT OF ORISSA AT CUTTACK CMP NO. 1102 OF 2024 Rajendra Nath @ Kumar Sahu …. Petitioner Mr. Jatindra Kumar Mohapatra, Advocate -versus- State of Odisha and others …. Opp. Parties Mr. Pradeep Kumar Sahoo, Additional Standing Counsel CORAM: JUSTICE K.R. MOHAPATRA Order No. 1. 1. 2.
Decision
ORDER 12.11.2024 This matter is taken up through hybrid mode. Order dated 31st August, 2024 (Annexure-3) passed in RFA No. 11 of 2020 is under challenge in this CMP, whereby learned Additional District Judge, Koraput at Jeypore allowed an application filed by the State-Opposite Parties under Order XLI Rule 5 C.P.C. for stay of further proceedings of the Execution Petition No.4 of 2022 till the next date of hearing of the appeal without asking for security as required under Order XLI Rule 5(3) C.P.C. 3. Mr. Mohapatra, learned counsel for the Petitioner submits that RFA No.11 of 2020 arises out of a money decree. The suit out of which RFA arises was decreed in favour of the Petitioner. Hence, he filed Execution Petition No.4 of 2022, which is pending in the Court of learned Civil Judge (Senior Division), Jeypore. During pendency of the appeal, the State- Opposite Parties filed an application for stay of further proceedings of the execution case. It is his submission that Page 1 of 7 // 2 // Order XLI Rule 5 deals with power of Appellate Court to pass an order of stay. Sub-rule 3 of Rule 5 of Order XLI provides as under: “(3) No order for stay of execution shall be made under Sub-rule (1) or Sub-rule (2) unless the Court making it is satisfied- (a) xxx xxx xxx (b) xxx xxx xxx (c) that security has been given by the applicant for due performance of such decree or order as may ultimately be binding upon him. Thus, the decree under challenge being passed in a money suit, i.e., C.S. No. 38 of 2010, the State-Opposite Parties should have furnished security for due performance of the decree. Learned Appellate Court taking aid of Order XXVII Rule 8-A C.P.C. exempted the State-Opposite Parties from furnishing security as a condition precedent for stay of execution vide order under Annexure-3. Hence, this CMP has been filed. 3.1 Mr. Mohapatra, learned counsel for the Petitioner in support of his submission relied upon the case law in Pam Developments Private Ltd. –v- The State of West Bengal, reported in (2019) 8 SCC 112, wherein the Hon’ble Apex Court at paragraph-21 held as under: “21. A Full Bench [Union of India v. Amitava Paul, 2015 SCC OnLine Cal 872 : AIR 2015 Cal 89] of the Calcutta High Court, while considering the question as the Government, the Government is entitled to get stay of execution of decree impugned by taking aid of Order 27 Rule 8-A CPC, even if the conditions mentioned in in an appeal preferred by to whether Page 2 of 7 // 3 // clauses (a) and (b) of sub-rule (3) of Rule 5 of Order 41 are not complied with, held as follows : loss” In order the appellant “36. the aforesaid to resolve controversy, one must examine the legislative intent for incorporating Order 27 Rule 8-A in the Code. The aforesaid provision was engrafted to exempt the Government to furnish security as a guarantee for due performance of a decree as mentioned in Rules 5 and 6 of Order 41. Notwithstanding such exemption, discretionary power of the Court to grant stay of execution of a decree can be exercised in favour of the appellant Government only if it satisfies the Court as to the existence of clauses (a) and (b) of Rule 5(3) of Order 41. As is a to “substantial condition precedent to grant stay, execution of a money decree is ordinarily not stayed since satisfaction of a money decree does not amount to irreparable injury to the appellant as the remedy of restitution is available to him in the event the appeal is allowed. (See Sihor Nagar Palika Bureau v. Bhabhlubhai Virabhai & Co. [Sihor Nagar Palika Bureau v. Bhabhlubhai Virabhai & Co., (2005) 4 SCC 1], para 6). Under such circumstances, when the court chooses to exercise its discretion in favour of the appellant State to grant stay of execution of a money decree it must balance the equities between the parties and ensure that no undue hardship is caused to a decree-holder due to stay of execution of such decree. Hence, in appropriate cases, the Court in its discretion may direct deposit of a part of the decretal sum so that the decree-holder may withdraw the same without prejudice and subject to the result of the appeal. Such direction for deposit Page 3 of 7 // 4 // of the decretal sum is not for the purpose of furnishing security for due performance of the decree but an equitable measure ensuring part satisfaction of the decree without prejudice to the parties and subject to the result of the appeal as a condition for stay of execution of the decree.” (emphasis supplied) He, therefore, submits that in view of the aforesaid case law, the State-Opposite Parties should have been directed to furnish security to secure due performance of the decree. He also relied upon the case law in M/s. Malwa Strips Pvt. Ltd. –v- M/s. Jyoti Ltd., reported in (2009) 2 SCC 426, wherein the Hon’ble Supreme Court at paragraph-12 held as under: “12. The High Court in this case failed to notice the provisions of sub-rule (3) of Rule 1 of Order 41. The appellate court, indisputably, has the discretion to direct deposit of such amount, as it may think fit, although the decretal amount has not been deposited in its entirety by the judgment-debtor at the time of filing of the appeal. But while granting stay of the execution of into consideration the facts and circumstances of the case before it. It is not to act arbitrarily either way. If a stay is granted, sufficient cause must be shown, which means that the materials on record were required to be perused and reasons are to be assigned. Such reasons should be cogent and adequate.” the decree, it must take He, therefore, submits that learned Appellate Court has erred in law in not directing the State-Opposite Parties to furnish security for due performance of the decree while passing an order of stay of further proceedings in Execution Petition No.4 of 2020. It is Page 4 of 7 // 5 // further submitted that neither any provision is stated in the petition for stay of further proceedings of the execution case nor the same was signed by the J.Dr. or supported by any affidavit. No ground for stay of further proceedings of the execution case has also been made out in the said petition. Hence, the petition should have been dismissed. He, therefore, prays for setting aside the impugned order under Annexure-3. 4. Mr. Sahoo, learned Additional Standing Counsel vehemently objects to the same. It is his submission that the case law in Pam Developments Private Ltd. (supra) relates to an arbitration proceeding and in the case of M/s. Malwa Strips Pvt. Ltd. (supra), the State is not the Applicant, who sought for stay of the execution proceeding. As such, none of the case laws is applicable to the case in hand. He verily relied upon the provisions of Order XXVII Rule 8-A C.P.C., which reads as under: “8-A. No security to be required from Government or a public officer in certain case – No such security as mentioned in Rules 5 and 6 of Order 41 shall be the required Government has undertaken the defence of the suit, from any public officer sued in respect of an act alleged to be done by him in his official capacity.” the Government or, where from He, therefore, submits that when learned Appellate Court assigning good reasons stayed operation of the execution proceeding, it should not be interfered with. 5. Considering the submissions made by learned counsel for the parties and on perusal of the record, it is apparent that the petition filed for stay of the execution proceeding has not been signed by the J.Dr or the same is supported by any affidavit. Page 5 of 7 // 6 // However, the same has been signed by learned counsel representing the State. The petition is not one under Rule 431 of the G.R.C.O. (Civil). The petition does not come under the purview of Order XIX Rule 3 CPC also. Hence, the same is not required to be signed by the J.Dr. or supported by any affidavit. Further, on perusal of the petition for stay of the execution proceeding, it appears that good reason has been assigned by the State-Opposite Parties for stay of the execution proceeding. Rule 8-A of Order XXVII clearly provides that no such security as mentioned in Rules 5 and 6 of Order XLI shall be required from the Government or, where the Government has undertaken the defence of the suit, from any public officer sued in respect of an act alleged to be done by him in his official capacity. 6. In the instant case, a money decree has been passed against the State-Opposite Parties. Order XLI Rule 1(3) CPC is not applicable to the instant case as the Petitioner claims that security should be furnished as a condition precedent for grant of stay of execution. Thus, the case at hand is one under Order XLI Rule 5(3) CPC. There cannot be any quarrel that the power of the Court under this Rule is discretionary and not mandatory. Order XXVII Rule 8-A C.P.C. is a qualifying provision to Order XLI Rules 5 and 6 CPC. It provides that Government or, where the Government has undertaken the defence of the suit, from any public officer sued in respect of an act alleged to be done by him in his official capacity. The case law in Pam Developments Private Ltd. (supra) is of no assistance to the Petitioner as discussing the principles for furnishing security to grant of stay of execution, Hon’ble Supreme Court has held such power of the Page 6 of 7 // 7 // Court to be discretionary and not mandatory. Further, it deals with an award passed under the Arbitration and Conciliation Act, 1996. Further, in the case of M/s. Malwa Strips Pvt. Ltd. (supra), the State was neither a party nor it has filed any application for stay of the execution proceeding. It also reiterates the principles decided in Pam Developments Private Ltd. (supra). Thus, the ratio in the aforesaid case law has no application to the instant case. 7. On perusal of the impugned order under Annexure-3, it is apparent that learned Appellate Court has assigned good reason for stay of further proceedings in Execution Petition No.4 of 2022 and it has also discussed the scope of Order XXVII Rule 8-A C.P.C. for not directing the State-Opposite Parties to furnish security for due performance of the decree. However, stay of execution shall not preclude the Petitioner to seek for suitable direction to the Appellants-Opposite Parties for disbursal of any amount, if occasion so arises. 8. Without interfering with the impugned order under Annexure-3, this Court disposes of the CMP with the aforesaid observation. In the facts and circumstances of the case, there shall be no order as to costs. bks (K.R. Mohapatra) Judge Signature Not Verified Digitally Signed Signed by: BIJAY KUMAR SAHOO Reason: Authentication Location: High Court of Orissa, Cuttack Date: 19-Nov-2024 14:40:33 Page 7 of 7