BASHIR AHMED QAMAR and anothers vs SHAKEEL EXPRESS (PRIVATE) LTD.
This matter concerns a petition for leave to appeal against an order of the Lahore High Court, which declined to modify a previous order requiring the petitioners to furnish a bank guarantee as a condition for staying the execution of a money decree. The core legal question was whether the High Court properly exercised its discretion in refusing to modify the condition of a bank guarantee, given the petitioners' claim of financial inability. The Supreme Court held that the High Court’s order was a discretionary one, and the petitioners failed to demonstrate that this discretion was exercised improperly or arbitrarily. The Court reaffirmed that while there is no absolute bar to staying the execution of a money decree, such relief is not automatic. The key principle laid down is that the power to stay the execution of a money decree is discretionary and must be exercised judicially. An applicant seeking such a stay must provide tangible grounds to satisfy the Court that 'substantial loss' will occur if the stay is not granted; mere assertions are insufficient to warrant interference.
- Is the stay of execution of a money decree an automatic right for a judgment-debtor?
- What must an applicant demonstrate to the Court to obtain a stay of execution of a money decree?
- Does the requirement to show 'substantial loss' for a stay of execution imply that mere annoyance or inconvenience is sufficient?
- Order XLI Rule 5, Code of Civil Procedure 1908
1. ' SAIDUZZAMAN SIDDIQUI, C.J.---The petitioners are seeking leave to appeal against the order of a learned Division Bench of Lahore High Court dated 11-10-1990. The impugned order was passed by the learned Division Bench on a miscellaneous application whereby the petitioner sought modification of an earlier order dated 13-7-1999 passed by the Court directing the petitioner to furnish a bank guarantee as a condition for stay of the decree.
2. The learned counsel for the petitioners contends that the decretal amount of Rs,24,33,300 is beyond the means of the petitioners and as such they are not in a position to furnish a bank guarantee for this amount. The order passed by the High Court declining to modify its earlier order is purely discretionary and nothing has been shown to us in support of the contention that the discretion was not exercised by the learned Judges properly. The learned counsel, in support of his contention, that the petitioners were entitled to the stay of the execution of the decree on furnishing security instead of bank guarantee, has relied on the case of Kohinoor Sugar Mills Ltd. v.
2. Kohinoor Textile Mills Ltd. (1996 SCM R 1883). In the case cited by the learned counsel, this Court while refusing to interfere with the discretionary order passed by the High Court observed as follows:-- "From the bare reading of the above it can be safely said that an order staying execution of a money decree is discretionary with the Court but such discretion has to be exercised in a judicial manner and for that reason it has been made obligatory that the Court shall be satisfied by reasonable grounds that 'substantial loss' will accrue if stay is not granted. It will be for the appellant to satisfy the Court and for that tangible grounds shall be stated so as to satisfy Court of the substantial loss would be caused in not granting the stay order. Mere reference of the word of 'substantial loss' will accrue if stay is not granted, is not sufficient compliance of the duty cast on the applicant seeking stay of the execution decree without elaborate such ground or grounds. No doubt as argued by the learned counsel for the respondent substantial loss is different from irreparable loss as far as satisfaction of the Court is concerned but that by itself does not absolve an applicant from expressly stating the fact leading to substantial loss being sustained in absence of stay of execution of decree. Even in 'Federation of Pakistan--Petitioner v. Malik Faiz Ahmad-- Respondent' the judgment relied upon by the learned counsel for the appellant it has been observed:-- ' It cannot be denied that it is an established rule of practice not to stay the execution of money decree in absence of special circumstances. The obvious reason behind this rule is that in terms of Order XLI, Rule 5, C.P.C. Execution cannot be stayed unless the Court is satisfied that substantial loss may otherwise result to the judgment-debtor. It has been laid down that such loss must be tangible and not a mere annoyance to the feelings.'
3. ' That case, too, was disposed of on the agreement of the parties, converting petition for leave to appeal into an appeal, staying the execution of the decree subject to the deposit for decretal amount in the executing Court with conditions provided therein for payment to the decree-holder.
4. ' It, therefore, transpires from the above that there is not absolute bar in staying the execution of the decree and in case the Court is satisfied, after hearing the parties, that substantial loss would occur the discretion can be exercised in favour of the judgment-debtor."
5. ' The above observations are hardly of any assistance to the petitioner in the circumstances of the present case. No case for interference with the judgment of the High Court is made out. The petition is, accordingly, dismissed and leave is refused .