Orders In Aid of Foreign Courts Proceedings

Dispute Resolution

Orders In Aid of Foreign Courts Proceedings

Do courts in your jurisdiction grant attachment orders in support of legal proceedings in another jurisdiction?

The question of whether courts grant attachment orders in support of legal proceedings in another jurisdiction, specifically in support of legal proceedings in foreign courts, is a question of valid discretion of the courts as well as the fact of an existing treaty with the reciprocating territory. The courts grant attachment orders in support of legal proceedings in another jurisdiction, if such order satisfies the conditions laid down under Section 13 of Code of Civil Procedure, 1908. A foreign judgment relating to immovable property will be enforceable only if the situs of the property is within the jurisdiction.  The courts will exercise their discretion to issue such an order if either the conditions laid down in the Section 13 have not been satisfied or the territorial jurisdiction of such foreign court lies in the territory of a non-reciprocating territory. The procedure for applying for an attachment order in support of foreign legal proceedings will not be the same as in support of legal proceedings. The applicant must file an application for the execution of such foreign decree along with a certified copy of the decree and a certificate from the superior court of such foreign country stating the amount, if any, has been satisfied of the decree as contemplated under Section 44A of the Code. If the attachment order is of the court of a non-reciprocating territory, it should be filed as a suit first.

Orders In Aid of Foreign Courts Proceedings FAQ's

How are attachment orders, foreign and domestic, enforced in your jurisdiction? What are the penalties for breaching the order?

Domestic attachment orders

Section 51 of the Code provides for the manner in which attachment orders are to be enforced. It can be by way of delivery of property specifically decreed, attachment of the property or sale of the attached property, arrest and detention in prison for the period not exceeding as prescribed in Section 58 and in any other manner as the relief wanted for in the application by the applicant. The requirement is filing of affidavit by the defendant stating particulars of his assets, manner in which movable and immovable assets are to be attached such as putting a copy of the attachment order on the conspicuous part of such asset (in case of immovable asset), attachment of shares, bonds, etc. which are to be done in the manner prescribed under Rules 41 to 57 of Order 21. Section 46 provides for the precept which is the issuance of a warrant or an order to the court in whose jurisdiction the asset to be attached lies, for execution of the decree. Such an order under precept is limited to two months, as a general rule.

Penalties for breach

Arrest and detention in civil prison, attachment and sale of the property are penalties prescribed for breach of the attachment order by the defendant. Seizure and delivery of the movable property is also provided as a penalty for the breach of attachment order in respect of the movable property. Such provisions for penalty have been laid down under the Rules 41 to 57 of the Order 21, while other remedies related to the costs are provided under Rules 30 to 36 of Order 21.

 

Overseas assets

Section 45 of the Code lays down the provision for enforcement of an attachment order or decree in regard of assets (with respect to overseas jurisdiction) in another jurisdiction. The local court passing the order of attachment should be empowered to send the order or the decree for execution, to the court in the reciprocating territory, as declared in the official gazette by the State government, with the authority of Central government. The enforcement proceedings should be commenced between three to twelve months from the date of issuing of order.

Foreign attachment orders

An attachment order of assets issued by a foreign court is to be enforced according to the procedure laid down by Section 44A of the Code. An applicant who seeks enforcement of order of attachment issued by a foreign court should file an application for execution of order/decree along with the certified copy of the decree of any of the superior courts of such reciprocating country and a Certificate by such superior court stating the extent to which such decree has been executed. In order to enforce an attachment order issued by a foreign court, it should be issued by a court of competent jurisdiction and should satisfy all the conditions laid down in Section 13 of the Code. In Renusagar Power Plant Co. Ltd. V. General Electric Co. AIR 1994 SC 860, the apex court held that a foreign judgment which offends public policy of India will not be enforced in India.

If it turns out that the attachment order should not have been granted, are damages or is compensation payable to the defendant? If so, how will the court go about calculating what is due?

 

Damages

Section 95 lays down the provision for compensation payable to the defendant if the Court wrongly attaches property of a person. If the court finds that the attachment order has been obtained on insufficient grounds against the defendant and it appears to the court that it should not have been granted on unreasonable or improbable grounds, it may order the plaintiff to pay as compensation such amount, not exceeding fifty thousand rupees including injury to reputation caused to defendant by the plaintiff. It is determined normally on the basis of injury caused to the defendant in addition to amount as deemed to be fit by the defendant, not exceeding fifty thousand rupees.

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