Garnishee order
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Garnishee order

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garnishee order given to banks

garnishee order given to banks

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Garnishee order Garnishee order Presentation Transcript

  • GARNISHEE ORDER BY M.SHIVA
  • CONTENTS 1. DEFINITION 2. EXAMPLE OF GARNISHEE ORDER 3. REVIEW OF CURRENT RULES 4. FEATURES OF GARNISHEE ORDER
  • Definition • If a Debtor fails to pay debt to his creditor, the creditor may apply to the court for issuing a Garnishee Order on the banker of his debtor. • This is issued under order 21,Rule 46 of the code of civil procedure1908.
  • Example of Garnishee order – Ram barrows money from Gopal. Then ram fails to repay. So gopal suit against him . Ram receives a court order to attach his funds with the bank. – The order issued by the court is called Garnishee order. – Gopal – judgement creditor – Ram- judgement debtor – Bank - garnishee
  • Review of Current Garnishment Rules • Creditor obtains judgment • Creditor requests a writ of garnishment (Rules 2-645 & 3-645) • Court Issues a Writ of Garnishment to “Garnishee” (usually a bank) • Notice mailed “promptly” to judgment debtor by creditor • Bank must freeze account until further order of court ··
  • Current Law, Continued • Court issues judgment, usually against the bank, ordering it to attach the funds in account to the creditor • Creditor has 30 days to respond to answer • Bank must answer the court regarding writ petition within 30 days and send copy to debtor
  • Features of Garnishee order • First banker will intimate to the customer regarding issue of the garnishee order and block the funds in the account • The order can attach either the entire amount or a part of it • Banker has right to set off any debt before attachment if it is due
  • • If A/c is overdrawn banker owes no money to the customer(Hence no effect of the order) • The order is not applicable on payments made by the bank • Security held in safe custody is not affected