2020 (8) TMI 933 - HC - Indian Laws

Judgment-debtor has the means to satisfy the money decree or not - Ascertainment of assets and income of the judgment-debtor - Form 16A of Appendix E under Order XXI Rule 41(2) of the Code of Civil Procedure - requirement of modifications in the judgements and formats of affidavit. HELD THAT - This Court is of the view that the directions issued by this Court in the judgment dated 05th December, 2019 and formats of the affidavits (Annexures A, B and C) formulated by this Court require modification, in order to make them more comprehensive. The judgment dated 05th December, 2019, is hereby modified.

Summary

Issues Involved:
1. Ascertainment of judgment-debtor's assets and income.
2. Formulation and implementation of comprehensive affidavit formats.
3. Expeditious hearing and disposal of execution cases.
4. Modification of existing guidelines and formats.
5. Legal provisions and powers of the Court in execution proceedings.
6. Verification and enforcement mechanisms.
7. Restitution and imposition of costs.
8. Consequences for false claims and frivolous litigation.
9. International best practices and recommendations for statutory incorporation.

Issue-wise Detailed Analysis:

1. Ascertainment of Judgment-Debtor's Assets and Income:
The Court emphasized that the Executing Court must ascertain the assets and income of the judgment-debtor to determine their ability to satisfy the money decree. The existing Form 16A of Appendix E under Order XXI Rule 41(2) of the Code of Civil Procedure is deemed insufficient for this purpose.

2. Formulation and Implementation of Comprehensive Affidavit Formats:
The Court formulated new formats for affidavits to be filed by judgment-debtors at the onset of execution proceedings. These formats include comprehensive details of assets, income, expenditure, and liabilities, aiming to curb delays and expedite execution proceedings. The modified formats are Annexures A1, B1, and C1.

3. Expeditious Hearing and Disposal of Execution Cases:
The Court highlighted the need for special attention and expeditious disposal of execution cases to maintain public confidence in the justice delivery system. Delays in execution erode public trust and prevent decree-holders from enjoying the fruits of their success.

4. Modification of Existing Guidelines and Formats:
The Court modified the directions issued in the judgment dated 05th December 2019, and the formats of affidavits to make them more comprehensive. The modified directions aim to address the delays and difficulties in execution proceedings.

5. Legal Provisions and Powers of the Court in Execution Proceedings:
The Court discussed various legal provisions under Order XXI of the Code of Civil Procedure, including Rule 41(2) for disclosure of assets, Rule 41(1) for oral examination of the judgment-debtor, and Rule 41(3) for detention of the judgment-debtor in case of non-compliance. The Court also referred to Sections 51(b), 60 to 64, and Order XXI Rules 41 to 57 for attachment of properties.

6. Verification and Enforcement Mechanisms:
The Court outlined the procedures for verifying the disclosures made by judgment-debtors, including the use of interrogatories, discovery, inspection, and oral examination under Section 165 of the Indian Evidence Act. The Court also empowered the Executing Court to restrain judgment-debtors from transferring assets and to attach properties.

7. Restitution and Imposition of Costs:
The Court emphasized the importance of restitution to compensate decree-holders for losses due to delays and obstruction by judgment-debtors. The Court also highlighted the need for imposing actual and realistic costs to deter frivolous litigation and false claims.

8. Consequences for False Claims and Frivolous Litigation:
The Court addressed the issue of false claims and frivolous litigation, emphasizing the need for prosecution under Section 209 of the Indian Penal Code. The Court suggested issuing show cause notices to judgment-debtors making false claims and taking appropriate action under Section 340 CrPC.

9. International Best Practices and Recommendations for Statutory Incorporation:
The Court examined international best practices from countries like the UK, USA, Canada, Australia, Singapore, Ireland, New Zealand, and South Africa. The Court recommended incorporating the mandatory filing of detailed affidavits of assets, income, expenditure, and liabilities in statutes, similar to developed countries. The Court directed the Central Government to consider this suggestion.

Conclusion:
The Court's judgment aims to streamline execution proceedings, ensure timely enforcement of decrees, and prevent abuse of the judicial process. The comprehensive affidavit formats and modified guidelines are designed to provide a clear and detailed disclosure of judgment-debtors' financial status, facilitating effective execution of decrees and awards. The Court also emphasized the need for statutory incorporation of these measures to enhance the efficiency and credibility of the justice delivery system.