Patna High Court
Rudreshwari Pd. Sinha vs Sm. Ramabati Devi And Ors. on 11 May, 1951
Equivalent citations: AIR1952PAT231, AIR 1952 PATNA 231
JUDGMENT C.P. Sinha, J.
1. This appeal has been preferred by the judgment-debtor against an order of the learned Subordinate Judge of Bhagalpur dated the 1st of May 1950, by which one Mr. Shakil, pleader, has been appointed receiver of the properties which have been directed by the final decree in a mortgage action to be sold.
2. The Court below has pleased to direct by its order dated the 16th of July 1949 that a receiver be appointed till the properties were brought to sale. No appeal was preferred against that order which became final. The judgment-debtor wanted that he should himself be appointed as receiver. The Court below allowed him opportunities to deposit certain sums of money and observed that, if the money were deposited within the time, allowed by the Court, the Court would consider the desirability of appointing the judgment-debtor as receiver. The judgment-debtor having failed to deposit the entire amount, the Court below has appointed the aforesaid pleader as receiver.
3. The facts can be briefly stated as follows: The judgment-debtor had executed a simple mortgage bond dated the 1st of April 1937 to secure a sum of Rs. 1,10,000/-. A mortgage suit No. 27 of 1941 was instituted and a preliminary decree was obtained on 23-4-1943 and the final decree was passed for a sum of Rs. 2,12,068/14/- on the 12th of November 1946, and execution of the decree was taken out in the year 1947. The judgment-debtor having taken objection that the properties were not saleable, the matter came to this Court and is now pending decision by the Supreme Court. As there was delay in bringing the properties to sale, an application was made on the 10th April, 1947, on behalf of the decree-holders for the appointment of a receiver till the decretal amount was fully realised by the sale of the mortgaged properties. The decree-holders happened to be the landlords of the properties in question and they were entitled to rent, and the Court by its order dated the 16th of July, 1949, had directed the payment of all the arrears of rent, and, as I have mentioned already, the entire amount of arrears not having been paid within the time allowed, a receiver has been appointed.
4. An application was made on the 19th of April, 1950, under Section 11 of the Bihar Money Lenders (Regulation of Transactions) Act (VII of 1939) inpayment of the decree by instalments. That application is still undisposed of and the proceeding for valuation of the properties under Section 13 of the said Act is also pending before the Court.
5. The learned Advocate General on behalf of the appellant has urged that, because of the provisions contained in Order 40, Rule 1, Sub-clause (2) of the Civil P. C., no receiver can be appointed in a mortgage action on the foot of a simple mortgage bond so as to remove from possession of the property the mortgagor who is entitled to remain in possession of the properties until they are brought to sale as provided by the decree and that a receiver cannot be asked to pay interest on the mortgage from out of the rents and profits of the properties because the decree-holder in execution of a simple mortgage decree is only entitled to realise his dues, both principal and interest, from the sale proceeds of the mortgaged properties after they have been brought to sale.
6. Order 40, Rule 1, Sub-clause (2) runs as follows: "Nothing in this rule shall authorize the Court to remove from the possession or custody of property any person whom any party to the suit has not a present right so to remove."
7. If the question were 'res integra', it would be necessary for this Court to consider the authorities bearing upon that point; but this contention of the learned Advocate General is concluded by the authorities of this Court in the cases of 'HARGOPAL NANDY v. DEONITI PRASAD', 24 Pat 282 and 'AMABNATH v. ABHOY KUMAR', 27 Pat 534.
8. In 'HARGOPAL NANDY v. DEONITI PRASAD', 24 Pat 282, a receiver was sought to be appointed during execution proceedings and summing up the contentions bearing on this point their Lordships observed as follows:
"The first three contentions really resolve into this: whether a receiver can be appointed in a suit on a simple mortgage or in execution proceedings taken to enforce the decree for sale."
And after a detailed review of several cases of the different High Courts including the case of 'NRISINGHA CHARAN v. RAJNITI PRASAD', 13 Pat L T 525 on which very great reliance was placed by the learned Advocate General, their Lordships have laid down the law that "in a suit on a simple mortgage for sale the Court has jurisdiction to appoint a receiver to take possession of the mortgaged property and to realise the rents, issues and profits of the property. But this does not necessarily lead to the conclusion that a receiver may be claimed by the mortgagee in a suit on a simple mortgage as a matter of right and as a matter of course: Ordinarily, a Court of justice should be disinclined to take the mortgaged property out of the possession of the mortgagor who is entitled to continue in possession of the same until ownership has passed out of his hands by a sale held in execution of the final decree in the action. A receiver in such a suit, or in execution proceedings resulting from a decree in such a suit, can only be appointed in exceptional circumstances when a special case is made out for putting the property in charge of an officer of the Court..... In the present case the execution stage has been reached. So far as the execution stage is concerned, the position is clearer still by virtue of the enactment of Section 51(d) of the Civil P. C. which provides that the appointment of a receiver is one of the modes of execution available to a decree-holder in a proper case. The provisions of Order XL, Rule 1 of the Code also were suitably amended by adding the words 'whether before or after decree' in Clause (a) to bring it in conformity with the new provisions contained in Section 51. It is hardly necessary to point out that the provisions of Section 51(d) have got to be read along with those of Order XL, Rule 1 of the Code in order to grant relief to a decree-holder by the appointment of a receiver." After having settled the question of law raised in that case, their Lordships proceeded to examine the facts of that case and came to the conclusion that "the receiver to be appointed in this case would only take charge of the properties pending the conclusion of the execution proceedings ending with the confirmation of the sale."
This decision, in my judgment, cannot be distinguished on any ground whatsoever. The only submission made by the learned Advocate General was that the decision on the question of law was a mere obiter dictum because, in his opinion, the matter could have been decided only upon the facts of that particular case. There is no merit in this contention because the decision on the question of law, apart from the facts of the case, was absolutely essential upon the contentions raised in the case, and it was only after having decided the general question of law that their Lordships had to address themselves to the particular facts of that case. This point of view as taken in the '24 Pat 282 case' has been accepted in another Division Bench decision of this Court in 'AMARNATH v. ABHOY KUMAR', 27 Pat 534. Though the facts of that case were a little different from the facts of the present case inasmuch as, according to the terms of the mortgage bond themselves, there was a provision for the appointment of a receiver on the happening of certain events, this distinction on the facts does not, in my opinion, affect the decision on the question of law.
9. So far as the present case is concerned, I feel satisfied that it was a fit case where a receiver should have been appointed, as has been pointed out by the Court below. According to the judgment-debtor himself, there is only a net income of Rs. 12,000/- is hardly sufficient to pay off even the annual interest upon the amount of the decree. The application made by the decree-holders on the 10th of April 1947 shows that there is a huge amount of rent due to the landlords decree-holders both in the shape of rent decree and rent suits which were pending at the time besides rents for which suits had not till then been brought and that the judgment-debtor appellant had not chosen to pay any rent to the landlords ever since the mortgage bond was executed in the year 1937 or even from before that date. It appears from paragraph 4 of that application that since 1341, corresponding to the year 1934, no rents had been paid. The Court below, therefore, in my judgment, was fully justified in holding that in this case a receiver should be appointed.
10. The only serious question that remains to be considered is whether it would be just and convenient in this case to appoint the judgment-debtor himself as Receiver of the properties until they are brought to sale in the execution case. As I have said, the annual net income of the properties is only Rs. 12,000/- and, if a stranger Receiver is appointed a large burden will be thrown upon the estate and the net annual income of Rs. 12,000/- will be reduced considerably. It is suggested that the properties in question consist of some valuable mines and that is mentioned as one of the grounds why it would be advantageous for the judgment-debtor to be appointed a Receiver. There is no allegation, however, by the judgment-debtor that any of these mines of china clay, mica, lead or coal has been prospected. We understand that the Supreme Court will not take a very long time to decide the matter as to whether the properties in execution are liable to be sold or not. Taking all these matters into consideration, I am of the opinion that it would be to the advantage of the estate itself and to the parties concerned if, in place of a stranger, the judgment-debtor himself is appointed Receiver, and I would accordingly appoint the judgment-debtor himself as the Receiver of the properties in execution until those properties are brought to sale in execution of the final decree in the mortgage action. The judgment-debtor will be taken to have been appointed as Receiver of these properties by the Court below who will give suitable directions in regard to the payment of the current rent and cess and other charges of public decrees & also payments towards interest on the amount of the decree as the Court below will consider fit and proper. The judgment-debtor will be liable to be discharged from receivership if he fails to carry out any of the directions of the Court below.
11. I would further direct the Court below to conclude as speedily as possible the hearing of the valuation matter as also the application for payment of the decree by instalments pending before it.
12. The appeal is accordingly allowed, but in the circumstances of the case I would order each party to bear his own costs of this Court.
Das, J.
13. I agree.