Where attachment before judgment is suspended upon acceptance of third-party security, and there exists serious variation in market value certificates regarding the security property, the trial Court must verify the correctness of valuation before accepting such security. Mechanical acceptance of disputed valuation warrants interference under Article 227.

advocatemmmohan

Civil Procedure Code, 1908 – Order XXXVIII Rule 5 – Attachment before judgment – Defendant furnishing security – Court must satisfy adequacy and genuineness of security – Mechanical acceptance impermissible – Paras 11–14

Section 94(e) & Section 151 CPC – Furnishing security to avoid attachment – Court must ascertain real value of property offered as security – Para 14

Article 227 Constitution of India – Supervisory jurisdiction – Interference justified where trial Court fails to examine material discrepancy – Para 16

Market Value Certificate – Conflicting certificates issued by two Sub-Registrar offices – Necessity to verify authenticity and correctness – Para 13–14

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FACTUAL BACKGROUND

• Plaintiff filed O.S. No.57 of 2025 for recovery of ₹50,57,250/- based on promissory note dated 27.10.2025.

• Filed I.A. No.615 of 2025 under Order XXXVIII Rule 5 CPC seeking attachment before judgment of defendant’s lands (A-Schedule properties).

• Trial Court issued show cause to furnish security within 72 hours.

• Defendant filed I.A. No.619 of 2025 offering third-party security (B-Schedule property).

• Trial Court accepted security and suspended attachment before judgment.

• Plaintiff challenged both orders in CRP Nos.95 & 149 of 2026.

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CONTENTIONS

Plaintiff (Revision Petitioner)

• Market value of B-Schedule property inflated fraudulently.

• Two conflicting Market Value Certificates issued:

  • Joint Sub Registrar-II (20.11.2025)

  • Joint Sub Registrar-I (25.11.2025)

• Trial Court mechanically accepted security without verification.

Defendant (Respondent)

• B-Schedule property value ₹1,11,90,080/-.

• Security adequate.

• Plaintiff attempting to retain attachment over higher value A-Schedule land.

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ISSUES

1. Whether trial Court properly examined adequacy and correctness of security furnished?

2. Whether suspension of attachment before judgment without resolving valuation dispute is sustainable?

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ANALYSIS

I. Scope of Order XXXVIII Rule 5 CPC

Attachment before judgment is a preventive remedy.
If defendant furnishes adequate security:

• Court may lift attachment.

• However, satisfaction of Court is mandatory.

Adequacy of security must be real and verifiable.

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II. Discrepancy in Market Value Certificates

Court observed:

• Significant variation between certificates dated 20.11.2025 and 25.11.2025.

• Both issued by different Sub-Registrar authorities for same property.

• Such inconsistency requires judicial scrutiny.

Failure of trial Court to ascertain correctness renders order unsustainable.

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III. Supervisory Interference under Article 227

High Court interfered because:

• Trial Court did not verify valuation discrepancy.

• Acceptance of security without inquiry is procedural irregularity.

Hence, orders set aside.

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OPERATIVE DIRECTIONS

• Impugned orders dated 21.11.2025 set aside.

• Trial Court directed to:

  • Ascertain veracity of both Market Value Certificates.

  • Hear both parties.

  • Pass reasoned order within four weeks.

Defendant granted liberty to file application regarding alienation of part of A-Schedule property, to be considered by trial Court in accordance with law.

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RATIO DECIDENDI

When security is furnished to avoid attachment before judgment, the Court must satisfy itself about the adequacy and correctness of the valuation of such security. If there exists material discrepancy in official valuation certificates, acceptance of security without verification is unsustainable and liable to be interfered with under Article 227.