OSA/154/2024 of JOSEPH PHILIP Vs MOORGATE INDUSTRIES INDIA LTD on 15 October 2026

Judgment

(Judgment of the Court was delivered by N.Sathish Kumar J.) Challenge made in the present appeal is against the dismissal of the application in A.No.8989 of 2019 dated 11.03.2021 seeking to set aside the order passed by the Master dated 14.11.2019 in A.No.8334 of 2018 in E.P.D.No.36475 of 2018.

2. The following are the brief facts for disposal of this appeal: An award has been passed against the second respondent company M/s.Rai Ispat India Pvt. Ltd.. At the instance of the decree holder, an application has been filed under Order XXI Rule 41 of the CPC for discovery of the assets of the company. During enquiry as directed by the Master, the appellant Director of the company has also produced certain documents. However, the Master has found that the accounts produced by the appellant do not reflect the true affairs of the company and according to him, the appellant has given false affidavit and therefore, ordered the appellant to be detained in

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civil prison for one month which was challenged before the learned single Judge. However, the learned Single Judge reduced the period for two weeks and dismissed the application and hence, the present appeal has been filed.

3. The learned counsel for the appellant would submit that now the decree holder has also not prosecuted the execution petition and the second respondent company was also wound up. Further, the learned counsel submitted that without any concrete evidence as to the nature of the documents filed by the appellant, the Master has arrived at the conclusion that there was false entry. According to the learned counsel, the enquiry contemplated under Order XXI Rule 41 is only for the discovery of the assets. When the order for producing the documents has been complied with, merely on the basis of some doubts, a person cannot be detained in civil prison.

4. Despite service of notice, none appeared on the side of the respondents.

5. Considering the submissions made by the learned counsel for the appellant and on perusing the materials available on record, the point that arises for consideration in this appeal is ‘Whether merely because some documents produced by the parties during the enquiry conducted under Order XXI Rule 41 of the CPC do not reflect the true accounts, can a person be detained?

6. A perusal of the entire order of the Master proceeded to detain the appellant in civil prison would show that the Master ordered for detention on the ground that accounts produced by the person has not reflected the true accounts and therefore, according to him, it was a false affidavit and hence, the

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appellant was detained. In this context, it is relevant to extract Order XXI Rule 41 of the CPC and the same reads as follows: ‘41.Examination of judgment-debtor as to his property.-- [(1)]Where a decree is for the payment of money the decree- holder may apply to the Court for an order that -- (a)the judgment-debtor, or (b)[where the judgment-debtor is a corporation], any officer thereof, or

(c) any other person, be orally examined as to whether any or what debts are owing to the judgment-debtor and whether the judgment-debtor has any and what other property or means of satisfying the decree; and the Court may make an order for the attendance and examination of such judgment-debtor, or officer or other person, and for the production of any books or document. [(2)Where a decree for the payment of money has remained unsatisfied for a period of thirty days, the Court may, on the application of the decree-holder and without prejudice to its power under sub-rule (1), by order require the judgment-debtor or where the judgment-debtor is a corporation, any officer thereof, to make an affidavit stating the particulars of the assets of the judgment- debtor.

(3) In case of disobedience of any order made under sub- rule (2), the Court making the order, or any Court to which the proceeding is transferred, may direct that the person disobeying the order be detained in the civil prison for a term not exceeding three months unless before the expiry of such term the Court directs his release.]’

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7. A close reading of the said provision makes it clear that the object of the provision is to obtain discovery in aid of execution of money decrees. In our view, the application under Order XXI Rule 41 of CPC is not an application for execution of the decree itself. It is only an application in aid of the execution and to discover certain facts to find out whether the assets of the judgment debtor is available to execute the decree. Therefore, when the application under Order XXI Rule 41 of CPC is not an execution, the person cannot be detained in civil prison merely on the ground that the accounts have not been tallied. The learned Master has come to such a conclusion merely on the basis of some suggestions in cross examination without proof that false affidavit has been filed. When the factum of alleged false affidavit has not been established in the manner known to law, the learned Master ought not to have come to such a conclusion.

8. Further, even assuming that if it is found in the cross examination that some false entries are found and the correct accounts are not reflected, the learned Master ought to have directed the appellant to produce the correct accounts before the court and even after such direction, if the party disobeys the directions of the Master, the said act will amount to disobedience and shall warrant for civil detention in prison under sub clause (3) of Rule 41 of Order XXI of CPC. Whereas when a person has already complied with the order passed under Order XXI Rule 41(2), the person cannot be detained for

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disobedience on different grounds when compliance has already been made pursuant to the order passed under Order XXI Rule 41(2) of CPC. Merely on the basis of some other reasons, the appellant cannot be detained. Therefore, we are of the view that the order passed by the learned Master and the learned single Judge cannot be sustained. Accordingly, the order passed by the learned Master dated 14.11.2019 in A.No.8334 of 2018 in EP.D.No.36475 of 2018 and the order passed by the learned Single Judge dated 11.03.2021 in A.No.8989 of 2019 in E.A.No.8334 of 2018 in EP.D.No.36475 of 2018 are set aside.

9. The learned counsel for the appellant has now submitted that the passport of the appellant has been deposited before the Registrar General of this Court. In such a case, it is hereby ordered that on a proper application filed by the appellant before the Registrar General and on proper identification of the party, the passport shall be returned to him. Accordingly, this original side appeal is allowed. No costs. Consequently, connected miscellaneous petitions are closed. (N.S.K.,J.) (G.K.M.,J.) 15-10-2026 Index: Yes/No Speaking/Non-speaking order Neutral Citation: Yes/No VVK

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N.SATHISH KUMAR J. AND GK.MUTHUKUMAAR J. VVK OSA No. 154 of 2024 AND CMP NO. 19528 OF 2024,CMP NO. 19530 OF 2024 15-10-2026