Laxmi Furniture and Saw Mills, Simla Vs. Himachal Pradesh Financial Corporation, Simla - Court Judgment

Excerpt:
- orderp.d. desai, c.j. 1. the impugned decision rendered in a proceeding for the execution of an order made under section 32 of the state financial corporations act, 1951 (hereinafter referred to as 'the act') is challenged insofar as it is adverse to the petitioner in regard to one and only one matter, namely, the rejection of the petitioner's contention that the respondent is not entitled to the recovery of future interest. by 'future interest' what is meant is the interest accruing due after the date of the order till the date of recovery.2. in himachal pradesh financial corporation v. m/s. himachal printing press, fao no. 73 of 1980, decided on august 26, 1980 by a division bench consisting of v. d. misra, c,j. and h. section thakur, j., the question whether under section 32,.....

Judgment:
ORDER

P.D. Desai, C.J.

1. The impugned decision rendered in a proceeding for the execution of an order made under Section 32 of the State Financial Corporations Act, 1951 (hereinafter referred to as 'the Act') is challenged insofar as it is adverse to the petitioner in regard to one and only one matter, namely, the rejection of the petitioner's contention that the respondent is not entitled to the recovery of future interest. By 'future interest' what is meant is the interest accruing due after the date of the order till the date of recovery.

2. In Himachal Pradesh Financial Corporation v. M/s. Himachal Printing Press, FAO No. 73 of 1980, decided on August 26, 1980 by a Division Bench consisting of V. D. Misra, C,J. and H. Section Thakur, J., the question whether under Section 32, Sub-section (1) of the Act the District Judge has the power to award future interest arose for consideration. The following pertinent observations made in the course of the judgment rendered in the said case are extracted so as to leave no room for doubt or scope fordebate on the interpretation placed on the relevant provisionsof the Act:

'Our attention is invited to Section 32 of the Act. Sub-section (1) gives jurisdiction to the District Judge to pass an ad interim order. What the sub-section says is that interim order shall be passed attaching the security or so much of the property of the industrial concern as would 'on being sold realise in his estimate an amount equivalent in value to the outstanding liability of the industrial concern to the Financial Corporation, together with the costs of the proceedings taken under Section 31.. .. ... ... ... ..

The power given to the District judge specifically includes the costs. It is silent about the future interest. Again, it specifies the amount. It has to be 'an amount equivalent in value to the outstanding liability of the industrial concern'. No other provision of law has been brought to our notice which gives jurisdiction to the Judge to grant future interest. The Judge could not have granted future interest..... .......'

3. The aforesaid declaration of law relating to the jurisdiction of the District Judge under Section 32 of the Act in regard to the grant of future interest is clear and specific. The ratio of the decision is that the District Judge has no power, authority and jurisdiction to grant future interest while making an order under Section 32 of the Act.

4. In the face of this declaration of law, the objection raised by the petitioner could not have been rejected on the ground that the proceedings for recovery of the amount inclusive of future interest being before the executing court, the validity of an order made under Section 32 awarding future interest could not be gone into by such Court. It is settled Jaw that the executing Court can go into the question whether or not the decree or order under execution is without jurisdiction and to refuse to execute the decree or order in case it is found to be without jurisdiction. This is so because a decree or order passed by a Court without jurisdiction is a nullity and its invalidity can be set up whenever and wherever it is sought to be enforced or relied upon (Sec: Kiran Singh v. Chaman Paswan, AIR 1954 SC 340). Under the circumstances, in my opinion, the Court below erred in rejecting the contention of the petitioner insofar as it related to the lack of jurisdiction to make an order under Section 32 of the Act awarding future interest.

5. A strenuous attempt was made by Shri A. K. Goel on behalf of the respondent to persuade me to take a view different from that taken in M/s. Himachal Printing Press's case by relying upon the provision of Sub-section (6) of Section 32. The decision is binding on me and I have, therefore, not permitted Mr. Goel to pursue the submission.

6. For the foregoing reasons, Rule is made absolute to the extent that the impugned decision is quashed and set aside only insofar as it overrules the objection of the petitioner that future interest was not liable to be recovered pursuant to the order made under Section 32 of the Act by the District Judge, Hamirpur and Una Districts, in Civil Misc. Application No. 1 of 1974. The said objection is valid and it is accepted. No costs.