ORDER
B. Seshasayana Reddy, J.
1. This civil revision petition is directed against the order-dated 15.4.2004 passed in I.A. No. 237 of 2004 in O.S. No. 56 of 2004 on the file of Senior Civil Judge, Kothagudem by which the learned Senior Civil Judge issued conditional attachment.
2. The respondent is the plaintiff and the petitioner is the defendant in O.S. No. 56 of 2004. The plaintiff filed the suit against the defendant for recovery of Rs. 1,49,710/-basing on the promissory notes executed by him on 15.4.2000 and 14.5.2000. He filed I.A. No. 237 of 2004 under Order 38, Rules 5 and 6 of CPC read with Section 151 CPC seeking attachment from judgment of the petition schedule properties. The properties sought for attachment have been detailed in the schedule annexed to the said petition. He enclosed third party affidavits of K. Jayaramayya to the effect that the defendant is making arrangements to alienate his movable properties in his house and thereby trying to leave the jurisdiction of the Court and that the defendant has offered to sell the moveable properties such as colour T.V., refrigerator and other articles to him. The order passed by the learned Senior Civil Judge on 15.4.2004 reads as follows:
“Heard. Issue conditional attachment on furnishing third party security within (48) hours and notice. Call on 22.4.2004.”
The attachment warrant was entrusted to the Bailiff on 16.42004. He served copy of the warrant on the defendant and took his signature in a token of receipt of the same and allowed time tilt 48.4.2000 for furnishing third party security. On 18.4.2004 the bailiff went to the house of the defendant and found it locked. He was informed by the wife of the defendant that the defendant was in no way concerned with the the house hold articles as the same were purchased by the amount given by her parents towards pasupukumkuma. She seems to have produced the receipts evidencing the purchase of the properties that were sought for attachment. Since the door of the house was found locked, the warrant could not be executed and the same was returned by the Bailiff to the Court on 22.4.2004. In the meanwhile, the defendant filed counter resisting the application. He also filed civil revision petition on 10.5.2004 assailing the order dated 15.4.2004 and moved C.M.P.No. 11187 of 2004 seeking interim suspension. This Court by order dated 11.5.2004 granted interim suspension till 30-6-2004 and subsequently it came to be extended until further orders by order dated 21.6.2004.
3. Learned Counsel for the petitioner/ defendant submits that the impugned order has been passed by the Trial Court without reaching satisfaction as contemplated under Rule 5(1) of Order 38 of CPC and therefore the impugned order is not in accordance with law and the same is required to be set aside. In support of his submission, reliance has been placed on the decisions of our High Court in Yenamala Chandra Reddy v. Nuvvula Chandramouli Naidu, , L. Narayana Reddy v. Canara Bank, , S.P.V. Babu v. Varalakshmi Finance Corporation, 1996 (4) ALD 453 (DB) and A. Obul Reddy v. D.C. Gurava Reddy, .
4. In the Yenamala Chandra Reddy v. Nuvula Chandramouli Naidu (supra), decision a Division Bench of our High Court held that the Court by reason of its power under Order 38, Rule 5(3) can order conditional attachment ‘also’ along with a show-cause notice to be issued under Order 38 Rule 5(1) of CPC. The revision in the cited case has been referred to a Division Bench by Neeladri Rao, J by an order dated 26-4-1990 as he considered that the decision in M. Venkaiah Naidu v. Neelavenamma, 1990 (1) ALT 311, requires re-consideration. The learned Judge while passing the reference order assigned certain reasons for disagreeing with the findings recorded in M. Venkaiah Naidu v. Neelavenamma’s case and also referred the judgment of the Madras High Court in N. Pappammal v. L. Chidambaram, . The point arising in Yenamala Chandra Reddy v. Nuvvula Chandramouli Naidu’s case is whether the procedure of notice contemplated in Clause (b) of Order 38, Rule 5 has to be followed for the purpose of granting conditional attachment under Sub-rule (3) of Order 38, Rule 5. After threadbare discussion on the provisions of Order 38, Rules 5 and 6 of CPC it has been held by the Division Bench as follows:
“For the aforesaid reasons, we hold that the Court by reason of its power under Order XXXVIII, Rule 5(3) can order conditional attachment ‘also’ along with a show-cause notice to be issued under Order XXXVIII Rule 5(1) of CPC. The Court can adopt the first part of Form No. 5, and in such an event, it may be necessary for the Court to hear the defendant before issuing such a notice. It is also open to the Court to adopt both the first and the second parts of Form No. 5, without issuing notice and direct the Bailiff to attach the property straightaway, if the defendant fails to comply with the first part of the Form. In the latter case, the order will be one of ‘conditional attachment’. However, if the defendant comes to Court and satisfies the Court, it will be open to the Court to withdraw such conditional attachment under Order XXXVIII, Rule 6(2). The above interpretation of the provisions seems to us to be in harmony with the intention of the Legislature. In any event, Sub-rule (4) of Order XXXVIII, Rule 5 does not come into play at the stage of ordering conditional attachment. No order of conditional attachment can be declared as void on account of the Court not following the procedure under Order XXXVIII, Rule 5(1) CPC.”
The above cited decision came to be followed by a Single Judge of this Court in L. Narayana Reddy v. Canara Bank, . It has been held by S. Parvatha Rao, J., as follows:
“From the above discussion, it is clear that an order of conditional attachment under Sub-rule (3) of Rule 5 of Order XXXVIII is made “in addition to directing the defendant to furnish security or show-cause why he should not furnish security” as observed by the Division Bench of this Court in Y. Chandra Reddy v. N. Chandra Mouli Naidu and Ors. (C.R.P.No. 3247 of 1989 dated 22.1.1991) referred to above; such directions to the defendant to furnish security or show-cause why he should not furnish security can be issued under Sub-rule (1) of the said Rule 5 only after the Court reaches the satisfaction “that the defendant, with intent to obstruct or delay the execution of any decree that may be passed against him, (a) is about to dispose of the whole or any part of his property, or (b) is about to remove the whole or any part of his property from the local limits of the jurisdiction of the Court.” In view of the above, inasmuch as the Subordinate Judge in this case has not specified the sum in respect of which security was to be furnished and the time within which the security was to be furnished or to appear and show-cause why he should not furnish security, and because no reasons whatsoever are given in the order showing that he is satisfied that the requirements of Sub-rule (1) of the said Rule 5 are fulfilled, this civil revision petition is allowed. The order of the Subordinate Judge in I.A.No. 313 of 1990 dated 25-10-1990 is set aside. This does not preclude the Subordinate Judge from considering the matter afresh and passing appropriate orders in the said I.A. There will be no order as to costs.”
In the S.P.V. Babu v. Varlakshmi Finance Corporation, case (supra) it has been held by the Division Bench of this Court that the Court before ordering attachment should be satisfied by cogent evidence that the defendant was about to alienate his properties and also that the said alienation is attempted to delay or defeat the decree. It is further held that an order of attachment before judgment affects the right of the owner of the property to deal with the same even before any verdict is available against him as regards the claim of the plaintiff. Such an order is not to be passed merely for the asking or in a routine manner. There must be cogent, prima facie, materials to lead the Court to the conclusion that there has been attempts by the defendant, to dispose of the property with a view to defeat the decree. Mere satisfaction that there has been an attempt to dispose of the property is in itself not sufficient and there must be further conclusion, again prima facie, that the attempt to alienate is to delay or defeat the decree. For reaching such satisfaction, there has to be before the Court some tangible material than the mere statement without giving any particulars and without disclosing the source of the information of attempted alienation.
5. In the A. Obul Reddy v. D.C. Gurava Reddy (supra), it has been held that recording of satisfaction as to whether the defendant is likely to dispose of whole or any part of his property is a mandatory requirement and attachment made without complying with such requirement is void.
6. Learned Counsel for the respondent/plaintiff submits that the Trial Court after reaching satisfaction issued conditional attachment and if the petitioner/ defendant intends vacation of the said order, he would have approached the Trial Court by filing an application under Order 38, Rule 6 of CPC and therefore the impugned order is not required to be interfered in this revision. He placed reliance on a decision of our High Court in Modem Mallikarjuna Rao v. Butti Bharathi and Ors., . In the cited case the impugned order therein came to be passed after the appearance of the defendant and filing counter. Indeed in the cited decision initially the conditional attachment was ordered and that order came to be set aside directing the Trial Court to hear both parties and pass reasoned order. This factual aspect can be culled out from Para 15 of the judgment of the cited case. For better appreciation, I may refer the said paragraph and it is thus:
“15. The petitioner-plaintiff specifically alleged in the said I.A. No. 1013 of 2002 that the second respondent-second defendant with the co-operation of Respondents 1 and 3 (Defendants 1 and 3) is making hectic efforts to draw away the amount mentioned in the schedule with intent to defeat his claim for the suit amount; that if the second respondent-second defendant is not restrained from doing so, the execution of the decree that the petitioner-plaintiff may obtain in the suit, will be defeated and that the petitioner-plaintiff will not be in a position to realize any portion of the decretal amount and he will thereby be put to irreparable loss. It was further stated in the said I.A. No. 1013 of 2002 that the second respondent with the concurrence of Respondents 1 and 39 Defendants 1 and 3) already withdrew an amount of Rs. 1,10,00,000/-relating to the works mentioned in the schedule; that the amount mentioned in the schedule is payable by the officers mentioned therein; that the respondents-defendants may be directed to furnish proper and adequate security for the suit amount and costs of the suit within the time to be granted by the Court and that the amount mentioned in the schedule may be attached before judgment in case the respondents-defendants fail to furnish security. The said averment is in consonance with Rule 5(1) of Order 38 CPC. The petitioner-plaintiff also filed third party affidavits stating that the second respondent-second Defendant is trying to withdraw the amount mentioned in the schedule as early as possible with intent to defeat or delay the claim of the petitioner-plaintiff. As the Court below at the first instance without issuing any show-cause notice straightaway passed order of conditional attachment giving 48 hours alone to the second respondent-second defendant to furnish security, this Court set aside the said order directing the Court below to hear both parties and pass reasoned order…”
Since the impugned order in the cited decision came to be passed after hearing both parties, the said decision may not be of much use to buttress the submission made by Counsel for the respondent/plaintiff.
7. Order 38, Rule 5 of CPC reads as follows:
“Where defendant may be called upon to furnish security for production of property:–5(1) Where, at any stage of a suit, the Court is satisfied, by affidavit or otherwise, that the defendant, with intent to obstruct or delay the execution of any decree that may be passed against him.
(a) is about to dispose of the whole or any part of his property, or
(b) is about to remove the whole or any part of his property from the local limits of the jurisdiction of the Court. The Court may direct the defendant, within a time to be fixed by it, either to furnish security, in such sum as may be specified in the order, to produce and place at the disposal of the Court, when required, the said property or the value of the same, or such portion thereof as may be sufficient to satisfy the decree, or to appear and show-cause why he should not furnish security.
(2) The plaintiff shall, unless the Court otherwise directs, specify the property required to be attached and the estimated value thereof.
(3) The Court may also in the order direct the conditional attachment of the whole or any portion of the property so specified.
(4) If an order of attachment is made without complying with the provisions of Sub-rule (1) of this rule, such attachment shall be void.”
It is necessary to refer Order 38, Rule 6 of CPC which reads as follows:
“Order XXXVIII, Rule 6: Attachment where cause not shown or security not furnished:–(1) Where the defendant fails to show-cause why he should not furnish security, or fails to furnish the security required, within the time fixed by the Court, the Court may order that the property specified, or such portion thereof as appears sufficient to satisfy any decree which may be passed in the suit, be attached.
(2) Where the defendant shows such cause or furnishes the required security, and the property specified or any portion of it has been attached, the Court shall order the attachment to be withdrawn, or make such other order as it thinks fit.”
There is divergence of opinion as to whether an attachment made before judgment without complying with the procedure specified in Rule 5 is a nullity or is voidable. Rule 5 is intended for the protection of the person whose property is sought to be attached before judgment. If he does not receive the notice required by law, and is thus denied the opportunity of preventing the attachment by the offer of security and injustice would accrue to him. Rule 5 is, therefore, being amended to clarify that, where the attachment is made without complying with the procedure laid down in Rule 5, such attachment shall be void. It is well settled, in view of the decision of the Division Bench of our High Court in Y. Chandra Reddy v. N. Chandramouli Naidu, , that conditional, order of attachment could be without notice to the defendant. The very fact that the defendant could file an application under Order 39, Rule 6(2) for withdrawal of the attachment indicates that the power of issue of conditional attachment without notice to the defendant under Order 5, Rule 3 is manifest.
8. The question that calls for consideration is that whether the Court is required to reach satisfaction before ordering conditional attachment. It has been held by our High Court in L. Narayana Reddy v. Canara Bank, , that such a satisfaction is pre-requisite for issuance of conditional attachment.
9. In the light of the above discussion, let me examine whether the Trial Court recorded satisfaction in ordering conditional attachment. The impugned order has been extracted in the aforesaid paras of the order. The impugned order does not indicate that the Trial Court passed the conditional attachment after reaching its satisfaction that the defendant with intent to obstruct or delay the execution of decree that may be passed against him,….(a) is about to dispose of the whole or any part of his property, or (b) is about to remove the whole or any part of his property from the local limits of the jurisdiction of the Court. Such is the situation, the impugned order is required to be set aside. Accordingly, this civil revision petition is allowed and the impugned order dated 15.4.2004 passed in I.A. No. 237 of 2004 in O.S. No. 56 of 2004 on the file of Senior Civil Judge, Kothagudem is set aside. This order does not preclude the learned Senior Civil Judge, Kothagudem from considering the matter afresh and passing appropriate orders in the said I.A. No costs.