2005 (4) TMI 624 - SC - Indian Laws

Supreme Court Stay: Statutory body can secure money decree with property, not cash. Strong appeal case.

The Supreme Court granted a stay on the execution of a money decree, allowing the appellant, a statutory body under the Gujarat Municipality Act, to ... - Issues:1. Stay on execution of money decree pending appeal.2. Discretion of the Appellate Court to direct deposit or security.3. Grounds for granting stay and choice between cash deposit or security.4. Prima facie case for hearing appeal on merits and public interest.Analysis:1. The appellant, a statutory body under the Gujarat Municipality Act, terminated a contract with the respondent, leading to a civil suit for damages. The High Court admitted the appeal for hearing and granted a stay subject to a cash deposit. The appellant sought variation, citing financial difficulties due to octroi abolition and offered security instead of cash deposit. The Court extended the deposit deadline but declined to dispense with it. The Supreme Court directed a stay on decree execution, subject to immovable property security.2. Order XLI Rule 1(3) and Rule 5(5) of the CPC provide for deposit or security in appeals against payment decrees. The Appellate Court has discretion to decide on deposit or security based on the case's circumstances. While money decree execution is not typically stayed, the power exists for appropriate cases, to be exercised judicially.3. The appellant raised various grounds in the appeal, including lack of legal evidence for the decree. The High Court considered a stay, focusing on cash deposit versus security. The Supreme Court found merit in allowing security instead of cash, noting the appellant's strong case for appeal hearing and public interest in retaining the amount during the appeal.4. Considering the submissions and circumstances, the Supreme Court held that security should have been permitted instead of insisting on a cash deposit by the High Court. The appellant furnished immovable property security as directed. The appeals were allowed, setting aside the High Court's orders and substituting the Supreme Court's interim order. No costs were awarded.