UNIVERSITY INSTITUTE OF LEGAL STUDIES,

PANJAB UNIVERSITY, CHANDIGARH

PROJECT TOPIC:
GARNISHEE ORDER
(ORDER 21 RULE 46A AND 46B)

SUBMITTED TO: SUBMITTED BY:

DR. KARAN JAWANDA RAGINI SHARMA 47/18

B.A. LLB. Hons.

8th Semester, Section A

Acknowledgement

I would like to thank Dr. Karan for giving me the opportunity to make a
project report on the topic “Garnishee Order”. While working on this project I came
across many different terms and doing all this research has widened the scope of my
thinking abilities in the subject.

I would also like to thank my friends who supported and guided me and helped
me to complete this project in the due course of time.
Index

Serial No. Topics Page No.

1. Introduction 1-2

2. Some important definitions 3

3. Garnishee Proceedings 3-4

4. Execution of money decree 4-5

5. Order 21 Rule 46: Garnishee Order 5

6. Rule 46-A: Notice to garnishee 5

7. Scope of Order 21 Rule 46 A 6-7

8. Rule 46-B: Order against garnishee 8

9. Scope of Order 21 Rule 46 B 8

10. Judicial trend with respect to Garnishee Order 8-10

11. Conclusion 10-11

12. References 12
Introduction
The word ‘Garnish’ is derived from an old French word ‘garnir’ which means ‘to warn’
or ‘to prepare’. It is to serve an heir with notice i.e. to warn of certain debts that must be paid
before the person is entitled to receive property as an heir.

A garnishee order is an order passed by an executing court directing or ordering a

garnishee not to pay money to judgment debtor since the latter is indebted to the Garnisher (decree-
holder).

It is an order of court to attach money or goods belonging to the judgment debtor in the
hands of a third person. It is a remedy available to any judgment creditor; this order may be made
by the court to holders of funds (3rd party) that no payments are to make until the court authorizes
them. The third party is known as garnishee and the court order is known as garnishee order.

The purpose of the order is to protect the interest of the creditors. An order served upon a
garnishee requiring him not to pay or deliver the money or property of the debtor (defendant) to
him and or requiring him to appear in the court and answer to the suit of the plaintiff to the extent
of the liability to the defendant. For example-

Suppose A owes Rs. 1000 to B and B owes Rs. 1000 to C. by a garnishee order the court
may require A not pay money owed to him to B, but instead to Pay C, since B owes the said amount
to C, who has obtained the order.

Suppose A owes B Rs 2,000/. A refuses to repay the amount to B and B sues A. He obtains
a decree in his favor. Here B is a judgment-creditor and A is the judgment-debtor. B comes to
know that A has some money in a bank account and would like to have his decree satisfied by
attaching the funds in the hands of A's bank. For this purpose he approaches a court and obtains a
Garnishee order attaching funds at the bank standing to the credit of A. In this e.g., A, is the
garnishee and B is the Garnisher (Person who initiates action).

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 Order 21 Rule 46 A to 46 I have been newly inserted in the Code of Civil Procedure by
the Amendment Act, 1976. They lay down the procedure in garnishee cases. Prior to amendment,
opinion expressed by various Courts was that the Court had no power to compel a garnishee to pay
debt in Court and in case a garnishee on appearance denied the debt, it was duty of the Court to
enquire that if debt was due and when garnishee was held liable to pay, except on certain
contingencies, it was not permissible to call upon him to pay the amount into Court. The object of
newly inserted Rule 46A is to render the debt due by the debtor of the judgment debtor available
in execution to the decree holder and not to drive him to a suit. The primary object of a garnishee
order is to make the debt due by the debtor of the judgment debtor available to the decree holder
in execution without driving him to the suit.

The court may, in the case of debt (other than a debt secured by a mortgage or charge)
which has been attached under Rule 46, upon the application of the attaching creditor, issue a
notice to garnishee liable to pay such debt, calling upon him either to pay into court the debt due
from him to the judgment debtor or so much thereof as may be sufficient to satisfy the decree and
costs of execution, or to appear and show cause why he should not do so.

The order contemplated by Rule 46 A is discretionary and the court may refuse to pass
such order if it is inequitable. The discretion, however, must be exercised judicially. In Mackenzie
& co. v. Anil kumar,1 it was held that where the court finds that there is bona fide dispute against
the claim and the dispute is not false or frivolous, it should not take action under this rule.

If money is payable to the judgment debtor on certain contingencies, the garnishee cannot
be asked to make payment unless those contingencies have taken place. In another landmark case
law of Jung v. Mohammad Al it was held that garnishee proceedings cannot be taken in respect
of a debt which cannot be attached under the code. Where the garnishee disputes his liability, the
court must raise an issue, and determine the liability of the garnishee.

1 AIR 1975 Cal 150

Some important definitions:
• Judgment Debtor: A judgment debtor is a person one who is obligated to pay a debt or
damages in accordance with a judgment entered by a court. 2
• Judgment Creditor: A judgment creditor is a creditor who has a money judgment
entered against the debtor and may enforce the judgment (as by attachment or writ of
execution).3
• Garnishee: A garnishee means a judgment-debtor’s debtor.4 He is a person or institution
that is indebted to another whose property has been subject to garnishment. He is a person
who is liable to pay a debt to a judgment debtor or to deliver any movable property to him.
• Garnisher: A garnisher is a judgment-creditor (decree-holder) who initiates a
garnishment action to reach the debtor’s property that is thought to be held or owed by a
third party.

Garnishee Proceedings
Garnishment is a judicial proceeding in which a creditor asks the court to order a third party
who is indebted to the debtor to turn over to the creditor any of the debtor’s property held by that
third party. 5

It is an inquisitorial proceeding, affording a harsh and extraordinary remedy. It is an

anomaly, a statutory invention sui generic, with no affinity to any action known to common law.
It is a method of seizure but it is not a levy in the usual acceptation of that term. It is proceeding
by which a diligent creditor may legally obtain preference over other creditors; and it is in the
nature of the creditor’s bill, or a sequestration of the effects of a debtor in the hands of his debtor.
It is a proceeding in which plaintiff in action seeks to reach the rights & effects of defendant by

2 https://www.merriam-webster.com/legal/judgment%20debtor
3 https://www.merriam-webster.com/dictionary/creditor#legalDictionary
4 Takwani C K (2003). Civil Procedure, Lucknow: Eastern Book Company.
5 Black’s Bryan Garner (2004). Black’s Law Dictionary
calling into court some third party, who has such effects in his possession or who is indebted to
defendant. While a garnishment proceeding accomplishes the same purposes as an attachment or
execution, it is in no sense a levy on property, but it is a judicial proceeding by which a new
judgment is to be obtained.

Garnishee proceedings are the proceedings are in rem as well as in personam. It operates
on the person of the garnishee as on the debt. Therefore, it is classified as a proceeding quasi in
rem.

In Kuchimanchi Nagamani vs. Mantri Prasada Agnihotrudu and others,6 the

petitioner filed suit for recovery. During the pendency of suit the Order of garnishee attachment of
amount lying with Government department was passed but no objections were raised by the
government authorities at that time and therefore, the Order became final. Later, when the
petitioner applied for withdrawal of amount, the Government Authorities objected. The Hon’ble
Court while setting aside the objections held that the authorities did not raise the objections at
relevant time and therefore, the objections are not to be entertained.

Execution of money decree

The executing court has been given power to recover any of the amounts of the judgment debtor,
which is in the hands of other. However, the court has no power to issue an order or direction to
anybody, may it be usual financier of the judgment-debtor to pay to satisfy the debt or decretal
amount for the judgment debtor, may it under assumption that the guarantee is able and can recover
the amount from judgment debtor or the judgment debtor will pay to garnishee. In the just out case,
the executing court has not held that any of the amounts of the judgment debtor who is not holding
any money of the judgment debtor is lying with the petitioner bank. The executing court did not
held that the petitioner under any provisions of law can be directed to create liability upon himself
to pay the amount to decree holder even under the assumption that petitioner may recover the
amount either from the judgment debtor or from state.

6 2001 (1) ALT 385

 In the case of State of Bikaner and Jaipur v. Additional Dist. & Sessions Judge,
Jodhpur, the order of the executing court, which is virtually a direction to create a liability for the
bank, rather than to pay any debt amount or deposit amount of the judgment debtor to decree holder
is therefore, in violation of the Rule 46 B of order 21 of CPC and is liable to be set aside. 7

Order 21 Rule 46: Garnishee Order

Order 21 Rule 46 A to Rule 46 I of Code of Civil Procedure, 1908 deals with Garnishee orders. It
was inserted in the code by the Amendment Act, 1976. This research project aims to deal with
Rules 46A and 46B of Order 21. Order 21 Rule 46A is as follows:

Rule 46-A: Notice to garnishee

“ (1) The Court may in the case of a debt (other than a debt secured by a mortgage or a
charge) which has been attached under rule 46, upon the application of the attaching creditor, issue
notice to the garnishee liable to pay such debt, calling upon him either to pay into Court the debt
due from him to the judgment-debtor or so much thereof as may be sufficient to satisfy the decree
and costs of execution, or to appear and show cause why he should not do so.

(2) An application under sub-rule (1) shall be made on affidavit verifying the facts alleged
and stating that in the belief of the deponent, the garnishee is indebted to the judgment-debtor.

(3) Where the garnishee pays in the Court the amount due from him to the judgment-debtor
or so much thereof as is sufficient to satisfy the decree and the costs of the execution, the Court
may direct that the amount may be paid to the decree-holder towards satisfaction of the decree and
costs of the execution. ”

7 AIR 2005 Raj 246

Scope of Order 21 Rule 46 A
Rule 46-A requires a notice to be issued to a garnishee before a garnishee order is passed
against him. In the case of Surinder Nath v Union of India it was held that if such notice is not
issued and opportunity of hearing is not afforded before passing an order, the order would be null
and void. In the eyes of the law, there is no existence of such an order and any step taken pursuant
to or an in enforcement of such an order would also be void. 8

The object of this rule is to render debt due by the debtor of the judgment debtor available
in execution to the decree holder and not to drive him to a suit. It applies to a debt, other than a
debt secured by a mortgage or a charge, which has been attached under R 46.

The word ‘may’ in the rule means that the rule is discretionary and the court may refuse to
act under this rule if it inequitable. If a debt attachable under R 46 has not in fact been attached
under this rule or the debt is one which cannot be attached under this rule garnishee proceedings
cannot be taken in respect thereof. Thus, the garnishee proceedings cannot be taken in respect of
a debt due to a firm in execution decree against the partners in their individual capacity.

The foundation of garnishee proceedings is an attachment under R 46.Further a decree

holder can proceed against a garnishee only where the judgment debtor has a present right to
recover the debt from his Judgment debtor (the garnishee). If money is payable to the judgment
debtor only on a certain contingencies, the decree holder would be subject to the same disability
as his judgment debtor & decree holder would be subject to the same disability as his judgment
debtor and has to wait till the happening of that contingency. 9 This so because the debt that is
attachable is one which the judgment debtor can enforce payment of, if he desires to do so.

8 AIR 1988 SC 1777

9 Jung v. Mohd Ali, AIR 1972 AP 70
Form of Notice

The notice submitted shall call upon the garnishee to show cause. In the case of Executive
Engineer, KSE Board v. JH Sharma, a money decree was obtained on the basis of Compromise.
At the instance of the decree holder, an attachment before judgment was effected, of a certain sum
of money, said to belonging to the judgment debtor which was in the hands of the appellant
garnishee, by way of prohibitory order. The executing court, at no stage, issued any notice under
O 21 R 46 to the garnishee. Only, a letter was directed by the court to be written, requesting the
garnishee to remit to be stated in the summons or notice. It would not attract O 58 R 5.10

Bank Account

In the case of a bank account which is in the joint names of two persons their shares are
taken as equal in the absence of evidence to the contrary. 11 Banker has the right to set off one
account against another account of the same person. 12

Cheque

It was held in the landmark case of Central Bank v. Rao, cheque cannot be attached under
O 21 R 46. It is attached under O21 R 51 relating to negotiable instrument.13

Contingent Debt

A contingent debt cannot be attached. For Example, where, under a building contract, the
building contractor is supposed to be paid only on the architect’s certificate then, unless and until
the certificate is issued the money at the owner’s hand cannot be attached for a debt due from
contactor.

10 AIR 1988 Ker 288

11 Balaraman v. varadammal, AIR 1987 Mad 99
12 United Bank of India v. Venugopalan, AIR 1990 Ker 223
13 AIR 1949 Cal 144
Rule 46-B: Order against garnishee
“Where the garnishee does not forthwith pay into Court the amount due from him to the
judgment-debtor or so much thereof as is sufficient to satisfy the decree and the costs of execution,
and does not appear and show cause in answer to the notice, the Court may order the garnishee to
comply with the terms of such notice, and on such order, execution may issue as though such order
were a decree against him.”

Scope of Order 21 Rule 46 B

It empowers the court, in case the garnishee does not appear and show cause against the
notice under R 46 A, to order him to comply with the terms of the notice and on such an order,
execution may be issued. Such an order is to be deemed to be a decree against the garnishee and
in favor of the judgment creditor. The further proceedings are in execution of that decree and
against the garnishee. 14

In the case of Roberts v. Death 15 the power to make the order is discretionary and may be
refused on sufficient grounds such as where the judgment debtor’s interest in the debt is not
personal but is in the capacity as a trustee.

Judicial trend with respect to Garnishee Order

In Kazim Jawaz Jung v. Mir Mohamad Ali Jaferi and Anr,16 the Appellant is the debtor
of judgment debtor. He was directed to deposit in Court amount payable to judgment debtor as
required by decree holder. The appellant disputed his liability with regard to amount due to
judgment debtor. He contended that the final decree with regard to liability amount has not been
passed yet and therefore the impugned amount becomes payable only when judgment

14 Lukka Vergese v. D Varkey, AIR 1965 Ker 47

15 (1882) 8 QBD 819
16 AIR 1972 AP 70
 debtor allots land to appellant. Thus, the appellant is not liable to pay any amount before
allotment of land by judgment debtor. The Hon’ble Andhra Pradesh High Court held that where
the judgment debtor himself is not entitled to recover amount from appellant then decree holder
has no right to recover amount from appellant.

In the case of Mackinnon Mackenzie and Company Pvt. Ltd. v. Anil Kumar Sen and
Anr,17 the question which came up for consideration is that if the garnishee denies that any sum
of money is due to the judgment-debtor whether it is open to the court to hold the garnishee liable
for the claim made by the judgment-debtor without raising and trying an issue on the question of
such liability.

The Hon’ble Calcutta High Court held that the Judge has a discretion under the Rule to,
make an order summarily or to settle an issue and try the same on evidence. No doubt the order
contemplated by the Rule is a discretionary one, but such discretion must be judicially exercised.
Where a Judge finds that a claim is bona fide disputed and the dispute is not frivolous, he should
not rush to a conclusion on the affidavit evidence having regard to the requirement of the Rule. A
garnishee order which enables a judgment-creditor to obtain satisfaction of his claim in a summary
proceeding is a matter of procedure, similar in scope as in the case of a judgment on admission
under Order 12 Rule 6 of the Civil Procedure Code or the summary procedure in suits to recover
debts or liquidated demands as prescribed in Chapter XIII-A of the Original Side Rules. This
procedure can be availed of by a decree-holder where either the debt is not disputed or the dispute
appears to the Court to be frivolous and without any substance. It is of no avail in a case where
there is a substantial bona fide dispute with regard to the debts sought to be attached.

In Surinder Nath v Union of India18, The garnishee order was for a fictitious sum of Rs.
8, 56,377.55 which was not mentioned in the show cause notice issued under Section 226(3) of
the Income Tax Act, 1961. The Hon’ble Supreme Court held that there can be no doubt that when
an order is made for the payment of a fictitious sum without giving any opportunity to a person,
against whom the order is made, to show cause against the passing of such an order for

17 AIR 1975 Cal 150

18 AIR 1988 SC 1777
 the said sum, the order is a nullity. The garnishee order that was passed was a nullity and
any sale held pursuant to such an order is also a nullity irrespective of its confirmation. In view of
the conduct of the firm and/or its said partner, they should share along with the Revenue a part of
the compensation that may be allowed to the auction purchaser. The Revenue shall see that the
said amount is refunded back to the auction-purchaser. Further, the auction-purchaser will be
entitled to get interest on the said amount at rate of fifteen per cent for a period of two years and a
half, during which the amount remained blocked, by way of compensation.

Conclusion
The Code of Civil Procedure empowers the court to issue the garnishee order. Prior to the
amendment in 1976, there was no provision relating to garnishee order in the code of civil
procedure, 1908. After the insertion of Amendment by the way of Code of civil procedure
Amendment Act, 1976, a direct provision was added to the Code of Civil Procedure, 1908. It
empowers the court to issue such an order on the application duly filed. But it is not mandatory on
the courts to issue the order every time as and when the application for its issuance is filed. It is
the discretionary power of the court to issue a garnishee order and not the mandatory provision.
The word ‘may’ in the rule means that the rule is discretionary and the court may refuse to act
under this rule if it inequitable or if it is likely to cause prejudice to garnishee.

The garnishee is required to make out a prima facie case before an issue as to his liability
may be ordered to be raised. Even if the garnishee disputes the indebtedness to the judgment
debtor, the court shall carry on the proceedings. If there is even little doubt about the indebtedness
of the judgment-debtor, the court shall continue with the proceedings. The Court must order an
issue to be raised and tried. Even if there is a reasonable doubt the matter should be tried.

The court has no power to issue order or direction to anybody, may it be usual financier of
the judgment-debtor, who is not holding any money of the judgment-debtor to pay to satisfy the
debt or decretal amount for the judgment-debtor, may it under assumption the garnishee is

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 able and can recover the amount from the judgment-debtor or the judgment-debtor will pay
to the garnishee The court may reject the application or refuse to issue such order if suitable
grounds are not found i.e. if the affidavit filed by the decree holder is vague, insufficient and
ambiguous; the proceedings would not sustain and would come at stake. The court may, in exercise
of sound discretion, control the use of writs of garnishment to the extent of preventing it from
being abused or becoming oppressive. If the assets are belonging to the defaulted member it cannot
be attached in Garnishee proceedings since it is not a debt due to the defaulted member.

Thus, it is concluded that it is very good piece of legislation by our parliamentarians. But
it has to be used with caution. While issuing such order, it is the duty of the court to check whether
the case is prima facie. It is also the duty of the court that while exercising the discretionary power,
the power is not misused and the innocent is not harassed.

11
References

Books:

➢ Takwani C K, Civil Procedure, Lucknow: Eastern Book Company.

➢ Basu’s, The code of civil procedure, New Delhi: Ashoka Law House.

Websites:

➢ http://www.indlaw.com/
➢ https://www.merriam-webster.com
➢ https://ijrar.com/upload_issue/ijrar_issue_551.pdf
➢ https://www.mondaq.com/india/financial-services/369332/a-glance-on-provision-of-
garnishee-order
➢ http://www.legalserviceindia.com/article/l422-Power-of-Indian-courts-to-issue-
Garnishee-Order.html

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