Holding

Imprisonment under Section 51 CPC is permissible only when the judgment‑debtor has (or had) the means to pay and willfully refuses or acts in bad faith; mere inability to pay is insufficient and violates constitutional and international human‑rights standards.

Summary

The appellants, judgment‑debtors, had decrees for payment of money against the Bank of Cochin and their properties were attached with a receiver appointed. The execution court issued a warrant for their arrest and detention in civil prison under Section 51 of the Code of Civil Procedure and Order 21 Rule 37, without investigating whether they possessed the means to pay or acted in bad faith. The Supreme Court examined whether such imprisonment violates Article 21 of the Constitution and Article 11 of the International Covenant on Civil and Political Rights, and whether international law informs the interpretation of the statutory provision. It held that imprisonment is permissible only when the debtor has (or had) the means to pay and willfully refuses or engages in dishonest conduct; mere indigence cannot justify detention. Consequently, the Court set aside the lower court’s order and directed a fresh determination of the debtors’ present means and any evidence of bad faith. The appeal was allowed.

Issues considered

Whether Section 51 of the Code of Civil Procedure, read with Order 21 Rule 37, authorises imprisonment of a judgment‑debtor solely for inability to pay.
Whether such imprisonment contravenes Article 21 of the Constitution of India.
Whether Article 11 of the International Covenant on Civil and Political Rights, to which India is a party, limits the operation of Section 51.
Whether international treaty obligations are part of domestic law for the purpose of statutory interpretation.
Whether the execution court erred by issuing a warrant without inquiry into the debtor's means and possible bad faith.

Legislation cited

Code of Civil Procedure, 1908s. Order 21 Rule 37, s. Section 51
Constitution of Indias. Article 14, s. Article 19, s. Article 21
International Covenant on Civil and Political Rightss. Article 11

Subjects

civil imprisonmentdebtorspersonal libertySection 51 CPChuman rightsInternational Covenant on Civil and Political RightsArticle 21 Constitutionbad faith

Judgment

913

JOLLY GEORGE VERGHESE & ANR. A
v.
THE BANK OF COCHIN
February 4, 1980
[V. R. KRISHNA IYER AND R. S. PATHAK, JJ.] B
Code of Civil Procedure-Section 51, Ordet 21, rule 37-Scope of-'
Debtor, if could be imprisoned for failure to pay his deb,/~lmprisonment
M•hen could be ordered.

The appellants were the judgment.debtors while the respondent-bank Wes the
decree·holder. In eixecution of the decree a warrant for arrest and detention in c
civil prison was issued to the appellants under section 51 and order 21, rule 37
of the Code of Civil Procedure. On an earlier occa.sion there had been a simi·
Jar warrant for arrest in execution of the same decree. The decree-holders also
proceeded against the properties of the judgment-debtors and in consequence all
their immovable properties had been attached for the purpose of sale in dis·
charge of the decree-debts. A receiver was appointed by the cxecntion court to
manage the properties under attachment. Even so, the court had issued a warrant D
• for the arrest of the judgment-debtors became on an earlier occasion a similar
warrant bad already been issued without any in.estigation as regards. the cnrrcnt
ability of the judgment-debtors to clear off the debts or their mala-fide refusal,
if any, to discharge the debts.

' On the question whether under such circumstances personal freedom of the
judgment-debtors can be held to ransom until repayment of the debt. E

Allowing the appeal,

HELD : 1. The words in section 51 which hurt are "or has had since the
'} ,, date of the decree the means to pay the amount of the decree." Superficially
""'-- read this implies that if at any time after the passing of en old decree the judg·
ment-debtor had come by some resources and had not discharged the decree he F
could be detained in prison even though at that later point of time he was
found to be penniless. This is not a sound position, apart from being inhuman
i.. going by the stendards of Article 11 of the International Covenant on Civil and
]J Political Rights and Article 21. A simple default to discharge is not enough.
There must be some element of bad faith beyond mere indifference to pay, some
deliberate or recusant disposition in the past or alternatively current moons to
-\ pay the decree or a substantial part of it. The provision emphasises the need G
i to establish not mere omission to pay but an attitude of refusal on demand
verging on dishonest disowning of the obligation under the decree. Considera·
tions of the debtor's other pressing needs Ond straitened circumstances will play
~ prominently. [922E-GJ

2. Unless there be some other vice or mens rea apart from failure to foot
the decree, international law frowns on holding. the debtor's person in civil H
prison, as hostage by the court. India is now a signatory to this Covenant and
',- Article Sl(c) of the Constitution obligates the State to "foster respect for
914 SUPREME COURT REPORTS [1980] 2 S.C.R.

A international law am.d treaty obligations in the dealings of organised peoples with
one another". Even so, until the Municipal Law is changed to accommodate
the Covenant what binds the courts is the former not the latter. [918A-Bl
'1
3. Quondom affluence and current indigence without intervening dishonesty
or bad faith in liquidating his liability can be consistent with Article 11 of th•

B
Covenant because then no detention is permissible under section 51 of the •
Code of Civil Procedure. [9210]

4. The high value of human dignity and the worth of the human person
enshrined in Article 21, read with Articles 14 and 19, obligates the State not I
to incarcerate except under law which is fair, just and reasonable in its proce-
dural essence. To cast a person in prison because, of his poverty and come-
quent inability to meet his contractual liability is appalling. To be poor is no
\_
c crime and to "recover" debts by the procedure of putting one in prison is flag-
rantly violative of Article 21 unless there is proof of the minimal fairness of
bis wilful failure to pay in spite of his sufficient means and absence of more
terribly pressing claims on his means such as medical bills to treat cancer or
other grave illness. Unreasonableness and unfairness in such a procedure is
inferable from Article 11 of the Covenant But this is precisely the interpreta-
tion put on the proviso to section 51 C.P.C. and the lethal blow of Article 21
D cannot strike down the provision as interpreted. [922A-Dl

CrvlL APPELLATE JURISDICTION : Civil Appeal No. 1991 of 1979.
Appeal by special leave from the Judgment and Order dated
9-7-1979 of the Kerala High Court in C.R.P. No. 1741 of 1979.
M. M. Abdul Khader and K. M. K. Nair for the Appellants.
K. M. Iyer and V. J. Franci~ for the) Respondent.

The Judgment of the Court was delivered by ,..
KRISHNA IYER. J.-This litigation has secured special leave~)..·
F
from us because it involves a profound issue of constitutional and
international law and offers a challenge to the nascent champions
of human rights in India whose politicised pre-occupation has for-
saken the civil debtor whose personal liberty is imperilled by the t
judicial process it&elf, thann to 1. 51 (Proviso) and O. 21, r. 37,
G Civil Procedure Code. Here is an appeal by judgment-debtors--
the appellants-whose personal freedom is in peril because a court (
warrant for arrest and detention in the civil prison is chasing them
for non-payment of an amount due to a bank-the respondent,
which ha~ ripened into a decree and has not yet been discharged.
Is such deprivation of liberty illegal?
B
From the perspective of international Jaw the questiQn posed is
whether it is right to enforce a contractual liability by imprisoning ./
, J. G. VERGHESE v. BANK OF COClllN (Krishna Iyer,!.) 915

a debtor in the teeth of Art. 11 of the International Covenant on A
Civil and Political Rights. The Article reads:
No one shall be imprisoned merely on the ·ground of
inability to fulfil a contractual obligation.
(Emphasis added)
• An apercu of Art. 21 of the Conslitutiou suggests the question B
whether it is fair procedure to deprive a person of his personal liberty
merely because he has not discharged tds contractual liability in the
face of the constitutional protection of He and liberty as expounded
and expanded by a chain of rulings o[ this Court beginning with
Maneka Gandhi's case.(') Article 21 mads:
c
21. Protection of life and personal liberty.-No person
shall be deprived of his life or :personal lib<:rty except
according to procedure established by law.
A third, though humdrum, question is as to whether, in this
case, s. 51 has been complied with in its enlightened signification.
• Thls turns on the humane meaning of the provision .
D

•
Some minimal facts may bear a brief J!arration sufficient to bring
the two problems we have indicated, although we must candidly
state that the Specal Leave Petition is innocent of these two issues
and the arguments at the bar have avoided virgin adventures. Even E
so, the points have been raised and counsel have helped with their
submissions. We therefore, proceed to decide.
The facts. The judgment-del:Jtors (appellants) suffered a decree
against them in O.S. No. 57 of 1972 in a sum of Rs. 2.5 lakhs, the
respondent-bani:: being the decree-holder. There are two other (I' ·
money decrees against the appellants (in O.S. 92 of 1972 and 94 of
1974), the total sum payable by them being over Rs. 7 lakhs. In
execution of the decree in question (O.S. 57 of 1972) a warrant for
arrest and detention in the civil prison was issued to the appellants
under s. 51 and 0.21, r. 37 of the Civil Procedure Code on
22-6-1979. Earlier, there had been a similar warrant for arrest in G
execution of the same decree. Besides this process, the decree-
holders had proceeded against the properties of the judgment.-deb-
tors and in consequence, all these immo¥able properties had been
at\ached for the purpose of sale in discharge of the decree debts.
It is averred that the execution court has also appointed a Receiver
for the management of the properties under attachment. In short, B
(1) Maneka Gm1dh iv. Union of India, [1978] l S.C.C. 248.
916 SUPREME COURT REPORTS [1980] 2 s.c.u

A the enjoyment or even the power to alienate the properties by the
judgment-debtors has been forbidden by the court direction keeping
them under attachment and appointing a Receiver to manage !hem.
Nevertheless, the court has issued a warrant for arrest because, on
an earlier occasion, a similar warrant had been already issued. The
High Court, in a short order, has summarily dismi;sed the revision
B filed by the judgment-debtors against the order oi arrest. We see
no investigation having been made by the executing court regarding
the c1ment ability of the judgment-debtors to clear off the debts or
their mala fide refusal, if any, to discharge the debts. The question
is whether under such circumstances the personal freedom of the
judgment-debtors can be held in ransom until repayment of the
debt, and if s. 51 read with 0. 21, r. 37, C.P.C. does warrant such
a step, whether the provision of law is constitutional. tested on the
touchstone of fair procedure under Art. 21 and in conformity with
the inherent dignity of the human person in the light of Art. 11 of
the International Covenant on avil and Political Rights. A modem
D Shylock is shackled by law's humane hand-cuffs.

At this stage, we may notice the two provisions .. Section 51
runs thus:
51. Subject to such conditions and limitations as may be pres-
cribed, the Court may, on the application of the decree-holder, order
E execution of the decree-
( a) by delivery of any property specifically decreed;
(b) by attachment and sale or by sale without attachment
of any property;
F (c) by arrest and detention in prison; ·)
( d) by appointing a receiver; or
( e) in such other manner as the nature of the relief granted
may require.
Provided that, where the decree is for the payment of money,
G execution by detention in prison shall not be ordered unless, after
giving the judgment-debtor an opportunity of showing cause why
he should not be committed to prison, the Court, for reasons record-
ed in writing, is satisfied-
( a) that the judgment-debtor, with the object or effect
B of obstructing or delaying the execution of the decree-
(i) is likely to abscond or leave the local limits of
the jurisdiction of the Court, or
• J. G. VERGHESE v. BANK OF COCHIN \Krishna Iyer, J.) 917

(ii) has, after the in,stitution of the suit in which the A
decree was passed, dishonestly transferred, con-
cealed, or removed any part of his property, or
committed any other act of ,bad faith in relation to
his property, or
(b) that the judgment-debtor has, or has had since B
the date of the deem:, the means to pay the
amount of the decree or some substantial part
thereof and refuses or neglects or has refused or
f neglected to pay the same, or

~-
( c) that the decree is for a sum for which !lie judgrnent-
debtor was bound in a fiduciary capacity to account. c
I Explanation.-In the calculation of the means of the judgment-
debtor for the purposes of clause (b), there shall be left out of
account any property which, by or under any law or custom having
the force of law for the time being in force, is exempt from attach-
ment in execution of the decree. D

(Emphasis added)
We may here read also order 21 Rule 37 :
37. (1) Notwithstanding anything in these rules,
where an application is for the execution of a decree for E
the payment of money by the arrest and detention il'l the
civil prison of a judgment-debtor who is liable to be
arrested in pursuance of the application, the Court shall,
instead of issuing a warrant for his arrest, issue a notice
calling upon him to appear before the Court on a day to
be specfiied in the notice and show cause why he should not F
be committed to the civil primi:
Provided that such notice shall not be necessary if the
Court is satisfied, by affidavit, or otherwise, that, with
the object or effect of delaying the execution of the
decree, the judgment-debtor is likely to abscond or leave G
the local limits of the jurisdiction of the Court.
(2) Where appearance is not made in obedience to the
notice, the Court shall, if the decree-holder so requires,
issue a warrant for the arrest of the judgment-debtor.

Right at the beginning, we may take up the bearing of Art. ·11 H
on the law that is to be applied by an Indian Court wh~n there is a
specific provision in the Civil Procedure Code, authorising detention
918 SUPREME COURT REPORTS [1980] 2 S.C.R. •
for non-payment of a decree debt. The Covenant bans imprison-
ment merely for not discharging a decree debt. Unless there be
iome other vice or mens rea apart from failure to foot the decree,
nternational law frowns on holding the debtor's person in civil prison,
as hostage by the court. India is now a signatory to this Covenant
and Art. 51 (c) of the Constitution obligates the State to "foster res-
B pect for international law and treaty obligations in the dealings of
organised peoples with one another". Even so, until the municipal
law is changed to accommodate the Covenant what binds the court
is the former, not the latter. A. H. Robertson in "Human Rights-
in National and International Law" rightly points out that inter-
national conventional law must go through the process of transforma-
c tion into the municipal law before the international treaty can become
an internal law.(1)
From the national point of view the national , rules alone
count. ...... With regard to interpretation, however, it is a principle
generally recognised in nationaj legal system that, in the event of
D doubt, the national rule is to be interpreted in accordance with the
State's international obligations.

The position has been spelt out correctly in a Kerala ruling(') on
the same point. In that case, a judgment-debtor was sought to be
detained under 0. 21, r. 37 C.P.C. although he was seventy and had
E spent away on his illness the means he once had to pay off tl1e decree.
The observations there made are apposite and may bear excerption :
The last argument which consumed most of the time of
the long arguments of. learned counsel for the appellant is
that the International Covenants on Civil and Political
:r Rights are part of the law of the land and have to be respe<*-
ed by the Municipal Courts. Article 11, which I have ex-
tracted earlier, grants immunity from imprisonment to indi-
gent but honest judgment-debtors.
The march of civilization has been a story of progressive
subordination of property rights to personal freedom; and a
G by-product of this subordination finds noble expression in the
declaration that "No one shall be imprisoned merely on the
ground of inability to fulfil a contractual obligation." This
revolutionary change in the regard for the human person is
spanned by the possible shock that a resuscitated Shylock
would suffer if a modern Daniel were to come to judgment
H
(I) p. 13.
(2) Xavier v. Canara Bank Ltd., 1969 KLT 927 at 931, 933.
J. G. VERGHESE v. BANK OF COCHIN (Krishna Iyer,!.) 919

when the former asks the pound of flesh from Antonio's A
bosom according to the tenor of the bond, by flatly refusing
the mayhem on the debtor, because the inability of an im-
pecunious obligee shall not imperil his liberty or person under
the new dispensation proclaimed by the Universal Declara-
tion of Human Rights. Viewed in this progressive perspec-
tive we may examine whether there is any conflict between B
s. 51 CPC and Article 11 of the International Covenants
quoted above. As already indicated by me, this latter pro-
vision only interdicts imprisonment if that is sought solely on
the ground of inability to fulfil the obligation. Section 51
also declares that if the debtor has no means to pay he
cannot be arrested and detained. If he has and still refuses c
or neglects to honour his obligation or if he commits actS of
bad faith, he incurs the liability to imprisonment under s.
51 of the Code, but this does not violate the mandate of
Article 11. However, if he once had the means but now
has not or if he has money now on which there are other
D
pressing claims, it is violative\ of the spirit of Article 11 to
arrest and confine him in jail so as to coerce him into
payment. .....

The judgment dealt with the effect of international law and the enforce-
ability of such Jaw at the instance of individuals within the State, arid
E
<>bserved:
The remedy for breaches of International Law in general
is not to be found in the law courts of the State because Inter-
national Law per se or proprio vigore has not the force or
authority of civil law, till under its inspirational impact actnal
legislation is undertaken. I agree that the Declaration of F
Human Rights merely sets a common standard of achievement
for all peoples and all nations but cannot create a binding set
of rules. Member States may seek, through appropriate agen-
cies, to initiate action when these basic rights are violated; but
individual citizens cannot complain about their breach in the
G
municipal courts even if the country concerned! has adopted the
covenants and ratified the operational protocol. The indivi-
dual cannot come to Court but may complain to the Human
Rights Committee, which, in turn, will set in motion other
procedures. In short, the basic human rights enshrined in the
International Covenants above referred to, may at best inform H
judicial institutions and inspire legislative action within mem-
ber-States; but apart from such deep reverence, remedial action
920 SUPREME COURT REPORTS [1980] 2 S.C.R.. '

A at the instance of an aggrieved individual is beyond the area
of judicial anthority.

While considering the international impact of international covenants
on municipal Jaw, the decision concluded :

B Indeed the construction I have adopted of s. 51, CPC has •
the flavour of Article 11 of the Human Rights Covenants.
Counsel for the appellant insisted that law and justice must be
on speaking terms-by justice he meant, in the present case1 )'
that a debtor unable to pay must not be getained in civil prison.
But my interpretation does put law and justice on speaking
c terms. Ccunsel for the respondent did argue that International
Law is the vanishing point of jurisprudence is itself vanishing
in a world where humanity is moving steadily, though slowly,
towards a world order, led by that intensely active, although
yet ineffectual body, the United Nations Organisation. Its
resolutions and covenants mirror the conscience of mank4id
D and insominate, within the member States, progressive legis-
lation; but till this last step of actual enactment of law takes
•
place, the citizen in a world of sovereign States, has only in-
choate rights in the domestic Courts under these international
covenants.

E While dealing with the impact of the Dicean rule of Jaw on pCJi;itive
law, Hood Phillips wrote--and this is all that the Covenant means now
for Indian courts administering mnnicipal Jaw Cl
The significance of this kind of doctrine for the English
lawyer is that it finds expression in three ways. First. it influ-
F ences legislators. The substantive law at any given time may
approximate to the "rule of Jaw'', but this oniy at the will of
Parliament. Secondly, its principles provide canons of inter-
pretation which express the individualistic attitude of English
courts and of those courts which have followed the English
tradition. They give an indication of how the Jaw will be
G applied and legislation interpreted. English courts lean in
favour of the liberty of the citizen, especially of his person :
they interpret strictly statutes which purport to diminish that
liberty, and presume that Parliament does not intend to res-
trict private rights in the absence of dear words to the con-
trary.
H
(1) O. Hood Phillips' Constitutional and Administrathc lc:'v 6th Edn.
p.40.
• J, G. VERGHESE v. BANK OF COCHIN (Krishna Iyer, !.) 921

The positive commitment of the States Parties ignites legislative A
action at home but does not automatically make the Covenant an en-
forceable part of the corpus juris of India.
Indeed, the Central Law Commission, in its Fifty Fourth Report,
did cognise the Covenant, while dealing with s. 51 C.P.C. : ( 1)
The question to be considered is, whether this mode of B
execution should be retained on the statute book, particularly
in view of the provision in the International Covenant on
Civil and Political Rights prohibiting imprisonment for a
mere non-performance of contract.
Tue Law Commission, in its unanimous report, quoted the key passages C
from the Kera/a ruling referred to above and endorsed its ratio. 'We
agree with this view' said the Law Commission and adopting that mean-
ing as the correct one did not recommend further change on this facet
of the Section. It is important to notice that, interpretationally speaking,
the Law Commission accepted the dynamics of the changed circum-
f stances of the debtor : (') I>
• However, if he once had the means but now has not, -or
if he has money now on which there are other pressing claims,
it is violative of the spirit of Article 11 to arrest and confine
him in jail so as to coerce him into payment.
This is reiterated by the Commission : E
Imprisonment is not to be ordered merely because, like
Shylock, the creditor says : ( 8 )
"I crave the law, the penalty and forfeit of my bond."
The law does recognise the principle that "Mercy is rea- F
sonable in the time of affliction, as clouds of rain in the time
of drought." ( 4 )

.. We concur with the Law Commission in its construction of s. 51
C.P.C. It follows that quondam afiluence and current indigence with-
out intervening dishonesty or bad faith in liquidating his liability can
be consistent with Art. 11 of the Covenant, because then no detention G
is permissible under s. 51, C.P.C.
Equally meaningful is the import of Art. 21 of the Constitution in
; ~ntext of imprisonment for non-payment of debts. The high
(l) p, 38.
(2) ibid p, 41. R
(3) Merchant of Venice, Act, 4, Scene l.
(4) Ecclesiasticus, 35 ·20.
922 SUPREME COURT REPORTS [1980] 2 S.C.R.

A value of human dignity and the worth of the human person en.shrined
in Art. 21, read with Arts. 14 and 19, obligates the State not to
incarcerate except under law which is fair, just and reasonable in its
procedural essence. Maneka Gandhi's case( 1) as developed further
in Sunil Batra v. Delhi Administration('), Sita Ram & Ors. v. State
of U.P.( 3) and Sunil Batra v. Delhi Administration(') lays down the
B proposition. It is too obvious to need elaboration that to cast a
person in prison because of his poverty and con&equent inability to
•
meet his contractual liability is appalling. To be poor, in this land
of daridra Narayana, is no crime and to 'recover' debts by the proce-
dure of putting one in prison is too flagrantly violative of Art. 21
unless there is proof of the minimal fairness of his wilful failure to
c pay in spite of his sufficient means and absence of more terribly press-
ing claims on his means such as medical bills to treat cancer or other
grave illness. Unreasonableness and unfairness in such a procedure
is inferable from Art. 11 of the Covepant. But this is precisely the
interpretation we have put on the Proviso to s. 51 C.P.C. and the lethal
D blow of Art. 21 can'not strike down the provision, as now interpret-
ed.
The words which hurt are "or has had since the date of the decree, •
the means to pay th~ amount of the decree". This implies, superfi-
cially read, that if at any time after the passing of an old decree the
judgment-debtor had come by some resources and had ,not discharged f
the decree, he could be detained in prison even though at that later
point of time he was found to be penniless. This is not a sound
position apart from being inhuman going by the standards of Art. 11
(of the Covenant) and Art. 21 (of the Constitution). The .simple
default to discharge is not enough. There must b~ some element
of bad faith beyond mere indifference to pay, some deliberate or
F
recusant disposition in the past or, alternatively, current means to
pay the decree or a substantial part of it. The provision emphasises
the need to establish not mere omission to pay but an attitude of
refusal on demand verging on dishonest disowning of the obliga-
tion under the decree. Here considerations of the debtor's other
G pressing needs and straitened circumstances will play prominently.
We would have, by this construction, sauced Jaw with justice, harmo-
nised s. 51 with the Covenant and the Constitution.
The question may squarely arise some day as to whether the
Proviso to s. 51 read with 0. 21, r. 37 is in excess of the Constitutional
(I) [1978] I S.C.R. 248.
II (2) [1978] 4 s.c.c. 494.
(3) [19791 2 S.C.R. 1085.
(4) [1980] 2 S.C.R. 557.
J. G. VERGHESE v. BANK OF COCHIN (Krishna Iyer, J.) 923

mandate in Art. 21 and bad in part. In the present case since we A
are remitting the matter for reconsideration, the stage has not yet
arisen for us to go into the vires, that is why we are desisting from
that essay.
In the present case the debtors are in distress because of the
blanket distraint of their properties. Whatever might have been B
their means once, that finding has become obsolete in view of later
happenings; Sri Krishnamurthi Iyer for the respondent fairly agreed
that the law being what we have stated, it is necessary to direct the
executing court to re-adjudicate on the present means of the debtors
vis a vis the present pressures of their indebtedness, or alternatively
whether they have had the ability to pay but have improperly evaded c
or postponed doing so or otherwise dishonestly committed acts of
bad faith respecting their assets. The court will take note of other
honest and urgent pressures o'n their assets, since that is the exercise
expected of the court under the proviso to s. 51. An earlier adjudi-
cation will bind if relevant circumstances have not materially changed.
D
• We set aside the judgment under appeal and direct the executing
court to deciile de novo the means of the judgment-debtors to dis-
charge the decree in the light of the interpretation we have given.
)
P.B.R. Appeal allowed.