JAVED PAREKH vs MUHAMMAD SAFDAR MALIK
This appeal arose from a suit for recovery of Rs. 25,80,000 filed under Order XXXVII of the Code of Civil Procedure 1908, which was decreed in favour of the respondent. Upon the appellant filing an appeal, the High Court directed the appellant to furnish surety for the decretal amount of Rs. 25,80,000. The appellant provided title deeds for a property valued at Rs. 40,00,000. Although the Nazir reported the property's market value between Rs. 30,00,000 and Rs. 32,00,000—exceeding the required security amount—the High Court rejected the security and ordered the appellant to furnish fresh security for Rs. 40,00,000. The Supreme Court addressed whether the High Court could arbitrarily increase the security requirement beyond the original order. The Court held that the High Court erred in rejecting the security, as the Nazir's valuation confirmed the property was sufficient to cover the decretal amount. The Supreme Court set aside the impugned order, emphasizing that judicial orders must be consistent and that security requirements should not be periodically revised based on speculative additions to claims, thereby ensuring judicial efficiency and preventing unnecessary litigation.
- Can a court reject security for a decretal amount if the offered property's market value, as verified by the Nazir, exceeds the required sum?
- Is it legally permissible for a court to arbitrarily increase the required security amount beyond the original order without sufficient justification?
- Should security furnished in a suit be periodically revised to account for potential mark-up or additions to the respondent's claim?
- Order XXXVII, Code of Civil Procedure 1908
' SABIHUDDIN AHMED, J.--- The basic facts involved in this appeal appear to be that the respondent filed a suit for recovery of Rs,25,80,000 under Order XXXVII, C.P.C. Contending that nine cheques issued by the appellant in his favour had been dishonoured. The suit was decreed in the respondent's favour and thereupon the appellant filed 1st appeal No,4 of 2007 before the Honourable High Court. The appeal was admitted for regular hearing subject to the directions requiring the appellant to furnish surety to the extent of the decretal amount i,e, Rs,25,80,000. It appears that in compliance with the aforesaid order the appellant submitted title deeds of a property owned by him together with valuation certificate indicating the value of the property to be about Rs,40, 00,000. The respondent objected before the Nazir receiving the surety that the property was highly over-valued. Nevertheless the Nazir attempted to ascertain the market value of the property through his staff from estate agencies and was informed that the value ranged between 30,00,000 to 32,00,000 and submitted his report before the Court. On the basis of the aforesaid report the impugned order was passed whereby the learned Judge directed that the property offered could not be accepted as security because its value was less than 40,00,000 and consequently directed the appellant to furnish fresh security in the amount of Rs,40,00,000 within one month.
2. We have heard learned counsel for both the parties and it is ex facie apparent that through a judicial order, dated 21-11-2007 the honorable Judge herself had only directed the appellant to furnish surety in the amount of Rs,25,80,000. It is totally incomprehensible that when the title document in respect of the property were admitted to be valued at more than the amount ordered by the Court how the Honourable Judge was persuaded to hold that such surety could not be accepted. Indeed the valuation certificate furnished by the appellant might have represented an exaggerated value, the fact remains that the Nazir himself had found the property worth more than the amount directed to be furnished as security. Indeed, no reasons for reviewing the earlier order, dated 21-11-2007 passed by the same learned Jui have been assigned nor it is shown on what basis the figure of 40,00,000 was arrived at.
3. Mr. Ghulam Qadir Jatoi, learned counsel for the respondent stated that in the meantime the respondent's claim together with mark-up would have reached to about 40,00,000. We are amazed by this logic because by that taken every security furnished before a Court would invariably be required to be periodically revised because of additions to the respondent's claim.
4. In view of the above we would allow this appeal, set aside the impugned order and direct that the security furnished before the High Court be accepted. At the same time, we are constrained to observe that greater care needs to be undertaken by the Honourable Judges of the High Court to help parties in avoiding litigation before this Court at considerable time and expense and causing delay in delivery of justice.