STATE BANK OF INDIA Vs. SUNDER SINGH TULA

JUDGEMENT

(1.) The appellant herein granted a term loan credit facility for Rs. 1,80,000/- to respondent no. 1, who executed an agreement in favour of the appellant, for Medium Term loan (Hypothecation of Vehicles). The vehicle met with an accident. Respondent no. 1 claimed compensation for damages/loss of vehicle from the Insurance Company, i. e. respondent no. 2. Ultimately, the Arbitrator gave an Award in favour of respondent no. 1 for a sum of Rs. 1,82,140/ -. Subsequently, the Award was made rule of the Court. The district Judge directed that the amount under award may be sent to the appellant- bank for crediting the same in the name of respondent no. 1. In between time the appellant filed a suit for recovery of the amount under the agreement. During the pendency of the civil suit, respondent no. 1 moved an application in the executing court for payment of money. The said application was opposed by the appellant on the ground of clause 8 of the Agreement entered into between the appellant and respondent no. 1, which runs as thus:

(2.) The appellant, under Clause 8 of the agreement claimed before the executing court to appropriate the said money deposited with the appellant-Bank in the name of respondent no. 1. However, the application of respondent no. 1 was allowed and objection filed by the appellant was rejected on the ground that the remedy of appellant lies elsewhere and not before the executing court. It is against the said order, dated 29.12.89, the appellant is in appeal before us.

(3.) Learned Counsel appearing for the appellant urged that in view of the subsequent orders, dated 22.2.90 and 5.3.90 passed by the District Judge, Srinagar, issuing an order of status quo in regard to the payment of money to respondent no. 1, the executing court may be directed to stop payment to respondent no. 1 deposited with the Bank, It is not disputed that when the order under appeal was passed, no injunction order was in existence. Therefore, the executing court, was right in holding that the remedy of the appellant is not before the executing court, but is elsewhere. This view of the executing court cannot be said to suffer from any illegality. However, we may like to observe that since order of injunction was passed subsequent to passing of the impugned order, it would be open to the appellant to file fresh application before the executing court, if it is permissible under law.