When Judgment Debtor Pleads 'No Means', Execution Court Must Conduct Enquiry Before Issuing Arrest Warrant : Kerala High Court

The Kerala High Court has recently held that if a judgment debtor appears before the court when served with a notice and contends that he has no means to pay off the decreed debt, the Court is bound to enquire into this contention before issuing a warrant of arrest under Order XXI Rule 40 of the Civil Procedure Code.

Justice A. Badharudeen was exploring the procedure to be followed before issuance of an arrest warrant in the execution of a decree for payment of money.

The Court was hearing an original petition filed by a second judgment-debtor aggrieved by the fact that despite filing an objection that he had no means to pay the decree debt, a warrant of arrest was issued against him without conducting an enquiry under Rule 40.

The Court noted that Order XXI Rule 37 stipulates that instead of issuing a warrant for his arrest, a notice may be issued calling upon the debtor to appear before the Court on a specified day and show cause why he should not be committed to the civil prison.

However, its proviso prescribes that such notice Kerais not necessary if the Court is satisfied that the judgment-debtor is likely to abscond or leave the local limits of its jurisdiction with the object of delaying the execution of the decree

Further, Rule 37 (2) provides that where appearance is not made in obedience to the notice, the Court shall issue a warrant for the arrest of the judgment-debtor if the decree-holder so requires.

"Thus, it appears that as per proviso to Order XXI Rule 37, a warrant of arrest can be issued without issuing Rule 37(1) notice, if the Court is satisfied by affidavit or otherwise that, with the object or effect of delaying the execution of the decree, the judgment debtor is likely to abscond or leave the local limits of the jurisdiction of the Court," the Judge observed. 

It was also found that Rule 40 deals with two situations.

• when the judgment-debtor appears on getting notice under Rule 37
• when the judgment-debtor is brought before the court after being arrested in execution of a decree for the payment of money before proving his means.
  

Reading Rules 37 and 40 together, the Court noted that CPC envisages only one enquiry regarding the judgment-debtor's liability for detention in prison in execution of a money decree. Therefore, the judgment-debtor is not entitled to further opportunity after the Court finds that he has sufficient means and has willfully neglected to pay the decree-debt.

This implies that when the judgment-debtor appears on notice issued under Rule 37 or is brought before Court after being arrested, it shall hear the decree-holder and take all such evidence produced by him in support of his application for execution, and then give the judgment-debtor an opportunity of showing cause why he should not be committed in civil prison.  

In this case, the petitioner had appeared before the Court on getting notice under Rule 37 and filed an objection stating that he had no means to pay the decree-debt.

In such a contingency, it is mandatory for the Court to conduct an enquiry under Rule 40 before issuing a warrant of arrest against him. Yet the District Judge had not enquired to find the genuineness of this contention before issuing the warrant.

In view of the matter, the order of the District Court was found to be per se illegal and requiring interference being perverse, arbitrary and illegal.

The impugned order was accordingly set aside. The District Judge was also directed to consider the objection filed by the petitioner and conduct an enquiry regarding the means as provided under Rule 40 and pass orders based on the said finding afresh within two months. 

Case Title: Dileepkumar v. Sriram Transport Finance Co. Ltd & Ors. 

Citation: 2022 LiveLaw (Ker) 41

Click Here To Read/Download The Order