Justice Pankaj Jain of the Punjab and Haryana High Court has directed all executing courts in Punjab, Haryana, and the Union Territory of Chandigarh to immediately deposit amounts received in execution proceedings into interest-bearing fixed deposits with nationalised banks, rather than allowing the funds to remain idle. The order was issued while deciding a civil revision petition arising from execution proceedings.
Background of the Petition
The petition challenged an order dated March 11, 2025, passed by the Additional Civil Judge (Senior Division), Safidon, in a matter involving money decrees. The contesting parties before the High Court were decree-holders against the defendants. Justice Jain held that litigants should not suffer because money remained with the court during execution proceedings.
Key Directions by the High Court
Justice Jain directed: "This court deems it necessary to direct the Executing Courts in the states of Punjab, Haryana and UT, Chandigarh, that the amounts received in execution proceedings be immediately deposited with nationalised bank instead of keeping them idle. This will ensure that the parties are not at a loss due to act of court." The court further ordered that money deposited in execution shall be placed in interest-bearing Fixed Deposits with a nationalised bank, and the fixed deposit should be transferred to the party entitled. The party concerned may withdraw the interest or continue with the fixed deposit.
Objective of the Directions
Explaining the rationale, Justice Jain observed: "Otherwise, the question qua interest for the period amount remaining deposited with Executing Court shall keep on bothering the courts. The act of court shall not prejudice any party." The directions aim to protect litigants from losing interest merely because the money remains in court custody and seek to eliminate recurring disputes over entitlement to interest for the period funds remain with the court.
Reference to Supreme Court's KL Suneja Case
Justice Jain referred to the Supreme Court's directions in the KL Suneja case, where the apex court had directed all courts and judicial forums to frame guidelines mandating that amounts deposited with their offices or registries be placed in banks or financial institutions to prevent loss. The Supreme Court had also directed that such guidelines should cover situations where litigants merely file payment instruments—such as pay orders, demand drafts, and banker's cheques—without seeking any order, and that they should be embodied in appropriate rules or regulations governing courts, tribunals, commissions, authorities, and other adjudicatory bodies.
Next Steps: Framing of Guidelines
In compliance with the Supreme Court's directions, Justice Jain ordered: "Accordingly, the matter be placed before the Chief Justice for framing of necessary guidelines complying with directions issued by the Supreme Court." This means the High Court will now work towards formalising the practice of investing court-held deposits into standard procedure across its jurisdiction.
Impact on Litigants and Courts
The directions are aimed at ensuring that money realised during execution of court decrees does not remain idle with executing courts. Instead, such amounts will now be placed in interest-bearing fixed deposits with nationalised banks until they are released to the successful party. This protects litigants from losing interest merely because the money remains in court custody and seeks to eliminate recurring disputes over who is entitled to interest for the period the funds remain with the court. The ruling also has administrative significance beyond the individual case, potentially leading to a standardised procedure across Punjab, Haryana, and Chandigarh.
