UNION OF INDIA versus RADHA KISSEN AGARWALLA & ANR.

Citation: [1969] 3 S.C.R. 28 · Decided: 06-12-1968 · Supreme Court of India · Bench: J.C. SHAH · Disposal: Appeal(s) allowed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

28 
UNION OF INDIA 
v. 
RADHA KISSEN AGARWALLA & ANR. 
December 6, 1968 
[J. C. SHAH, V. RAMASWAMI AND A. N. GROVER, JJ.] 
B 
Provide/It Funds Ac;/, 1925, s. 3(1)-Foreign Railway employee elecz-
inR to have his provident fund In sterling-·lnstructing Railway administra-
tion to remit money to his bank in U.K.-Railway forwarding amount to 
Reserve Bank for conversion and remittance-Whether amount exempt 
from attachment before remittance and while with the Reserve Bank. 
B was an employee of the East India Railway and a subscriber to 
the State Railway Provident Fund. He elected to be governed by the 
Provident Fund Sterling Account Rules, according to which payment of 
his provident fund on retirement was to be made in sterling. 
B 'addressed 
letters to the Railway Accounts Officer in August 1947 and again after 
his retirement in February 1956 requesting that the amounts standing 
to his credit in the provident fund account be remitted to his bank in the 
United Kingdom. 
The Railway udministration drew cheques in respect 
of B's provident fund in favour of the 
Reserve Bank of India and ins-
tructed that bank to convert the amount into sterling and to transmit it 
to B's· Bank in the United Xingdom. 
'rhe respondent had o,btain~d a 1noney decree against B and upon. 
applying for execution of that decree obtained an order for attachment 
or tbt: cheques 
lying with the Reserve 
Bank. The cheques we.re en-
cashed and the amount realised ·was deposited in the executing -court, The 
appellant claimed immunity from attachment of the cheques under s. 3 
of the Provident Funds Act, 1925 and the respondent's execution appli-
cation was thereupon struck off. 
On filing a second execution applica-
tion. 
the respondent obtained an order for 
attachment of the money 
lying in the executing court. A further 
application by the 
applicant 
· claiming immunity from attachment was rejected by the executing court 
on the ground that the monies attached by th~ cou.rt loiit their character 
as provident fund monies Jong before they were attached and were not 
therefore- immune from attachment. 
The High Court in revision 
con-
firmed the order of the executing court. 
On apP.al to this Court, 
HELD : Allowin~ tlie appeal 
The order of attachment passed by the. executing court was contrary 
to s. 3 of the Provident Funds Act, 1925. 
The Raihvay administration was in 
respect of the 
provident fund 
money in the position of a trustee for B and it had undertaken to discharge 
its obligation by arranging to haVe the amount converted into sterling and 
to remit it to B. 
The Reserve Bank was the agent of the Railway ad-
ministration for converting and remitting the amount on its behalf. Until 
the money was converted and transmitted by the 
Reserve Bank to 
B, 
it remained at the disposal of the Railway administration, 
So Jong as 
the money remained under the control of the Railway administration as 
provident fund moriey, it was exempt from attachment under s. 60(1) (k) 
CPC read with s. 3 of the Provident, Funds Ac!, 1925. [31 B-F] 
c 
D 
E 
F 
G 
H 
I 
UNION v. RADHA K!SSEN (Shah, J.) 
29 
A 
The High Court was in error in relying on Illustration (d) of s. 50 
of the Contract Act. 
B had not authorised the Reserve Bank to receive 
payment of the money on his behalf, nor had he sanctioned payment to 
the Reserve Bank in discharge of the Jiahflity of the Railway Administra-
tion. [32 A-Bl 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 105 of 
B 
1966. 
c 
D 
E 
F 
G 
H 
Appeal from the judgment and order dated February 3, 1961 
of the Calcutta High Court in Civil Revision No. 2755 of 1957. 
D. Narsaraju, R. M. Mehta and S. P. Nayar, for the appellant. 
Ganpat Rai, for respondent No. 1. 
Tl:!_e Judgment of the Court was delivered by 
SHAH, J. G. W. Browne was an employee of the East India 
Railway and was a subscriber to the State Railway Provident Fund. 
He eleeted to be governed by the Provident Fund Sterling Accounts 
Rules, whereunder payment of the provident fund credited in his 
account in rupees was on retirement to be made in sterling. 
On 
August 26, 1947, Browne addressed a letter to the Financial Ad-
viser and Chief Accounts Officer, East India Railway, requesting 
that the provident fund payable to him on retirement may be 
remitted to him by Bank Draft on the District Bank,-Water Street, 
Liverpool. 
After Browne retired from service, the Deputy Gene-
ral Manager, Eastern Railway, wrote a letter on July 27, 1955, 
to the

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