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Anandrao Bhai Vs. Sitabai - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai
Decided On
Case NumberO.C.J. Suit No. 327 of 1907
Judge
Reported in(1908)10BOMLR1176
AppellantAnandrao Bhai
RespondentSitabai
Excerpt:
practice-special commissioner-power to sell-vesting the property in the special commissioner-procedure.;the court has no power or jurisdiction whatever-inherent or conferred-first, to appoint a special commissioner for sale of immove-able property; secondly, to vest immoveable property in a special commissioner; and, lastly, to empower any such special commissioner to execute a conveyance of such property. - - that at all events was a good appointment. the appeal to 'inherent general jurisdiction' of the court is generally made as a last resource in most cases involving questions of the power or jurisdiction of the court when all other means fail. that at all events was a good appointment. if parties to a suit choose to come to an agreement which contains a term which is not lawful and..........the decree is whether the court had power or jurisdiction to vest the plaintiff's property in special commissioner, the second defendant herein. the question is specifically raised in para 9 of the plaint and by issue no. 5 in the suit and it would i think be convenient to discuss this at once. if the court had no power to vest the plaintiff's property in the special commissioner the conveyance, ex. no. 3, executed by him on the 22nd of september 1906 in favour of the first defendant would be valueless. this question has recently arisen more than once but it has never been adjudicated upon and as a question of practice is one of considerable importance.2. it is a very suggestive fact that whereas in the first consent order mr. lane is very properly appointed a receiver, in this.....
Judgment:

Davar, J.

1. [His Lordship after setting out the facts continued:--]

The first question that arises under the decree is whether the Court had power or jurisdiction to vest the plaintiff's property in Special Commissioner, the second defendant herein. The question is specifically raised in para 9 of the plaint and by issue No. 5 in the Suit and it would I think be convenient to discuss this at once. If the Court had no power to vest the plaintiff's property in the Special Commissioner the conveyance, Ex. No. 3, executed by him on the 22nd of September 1906 in favour of the first defendant would be valueless. This question has recently arisen more than once but it has never been adjudicated upon and as a question of practice is one of considerable importance.

2. It is a very suggestive fact that whereas in the first consent order Mr. Lane is very properly appointed a receiver, in this order subsequently obtained in the same suit and for very much the same purposes Mr. Manker is appointed a Special Commissioner. Why is this ?. The answer is not far to seek. At the date of this consent decretal order a rule of the Bar Society was in force which prohibited all practising Barristers from accepting the office of the Receiver. In considering the question whether the Court has power to vest the property of a party before it in a Special Commissioner for the purpose of executing a conveyance thereof in favour of a stranger, it would be desirable to consider whether a Special Commissioner for the purpose of effecting the sale of a litigant's property is known or to recognized by the law. It must at the outset be admitted that such orders have before now been made by this Court. They mostly have been consent orders. The use of the words 'Special Commissioner '' instead of 'Receiver' in these orders have always been used as a subterfuge to evade the operation of the Bar rule I have mentioned above and another rule which still is in existence that no officer of the Court should accept the office of Receiver without the express permission of the Chief Justice. There is yet another reason why the subterfuge has been resorted to. Some years ago the late Chief Justice Sir Lawrence Jenkins by a circular drew the attention of the Original Side Judge8 to the case of Allan v. Loyd (1879) 12 Ch. D. 447 in which the Court of Appeal held that the appointment of a solicitor as a Receiver was improper and because the Judges began refusing to appoint solicitors as Receivers recourse was had to this mode of evading the objection by calling them. Special Commissioners instead of Receivers whenever it was desired to appoint them Receivers. The mere fact however that such orders as these have before now been made does not legalise the making of them if the Court has no power or jurisdiction to make them nor does it entitle a party to say because these Courts have made such orders before they should continue to make them. Nor again the mere fact that Courts have inadvertently been hitherto making such orders is any justification that similar orders should be continued to be made. This is not by any means the first time that the legality of passing such orders has been questioned but so far as I am aware this is the first time the question has directly arisen in a suit and has been fully discussed at the Bar. The question again so far as I know is not covered by any authority.

3. The arguments advanced by the first defendant in support of the order vesting the property in the second defendant have been carefully noted by me. They amount to this :-

The Court had power to vest property in the Special Commissioner, first, under the inherent general jurisdiction of the Court, and, secondly, under the Charter and the Amended Letters Patent.

If this was a matter of procedure and not of Relief then it is a mere irregularity in procedure.

Irregularity was either in describing Mr. Manker as Special Commissioner instead of calling him Receiver or it was an irregularity to vest the property in him at all.

This irregularity cannot vitiate the sale. Mr. Manker was Commissioner for sale. That at all events was a good appointment. He had anyhow power to enter into an agreement to sell. Under Section 32, para 2, of the Indian Trustee Act, the Court had power to vest the property in the second defendant.

4. When all parties agree under Section 375 of the Civil Procedure Code the Court has jurisdiction to make any order that the parties desire.'

Under Rule 518 an officer of the Court may be authorised by the Court to convey immoveable property.

5. I have here reproduced the gist of the arguments addressed to me by Sitabai's Counsel from the notes I made at the time.

6. I am afraid there is not much substance in any of the arguments advanced by the learned Counsel for Sitabai. The appeal to 'inherent general jurisdiction' of the Court is generally made as a last resource in most cases involving questions of the power or jurisdiction of the Court when all other means fail. To put the argument barely it comes to this :-

The High Court can whenever it chooses deprive the legal owner of property who may be a party to proceedings before the Court of all dominion over that poperty and clothe a stranger with all the right and powers of ownership of that property.Wherever legislature has thought it necessary to confer such powers on the High Court it has done so by express legislation as for example when by the Civil Procedure Code the Court has conferred powers on Civil Court to appoint Receivers under certain circumstances and defined what powers the Court may confer on such Receivers, or again when by the Indian Trustee Act it confers certain powers on Civil Courts for making orders vesting, property vested in mortgages and trustees, in other parties under certain circumstances. The very fact that the power of vesting property in Receivers and Trustees has been expressly conferred on the Court by legislation militates against the contention that this Court has inherent jurisdiction to make orders of the kind now under discussion independently of any legislative enactment.

7. In support of his contention that this power is impliedly conferred on the High Court by the Charter and the Letters Patent the learned Counsel has read to me stray passages authorising the Court to 'give judgment and sentence according to justice and right ' and make orders that 'shall be consistent with the attainment of substantial justice.' These passages confer no such powers as contended for and I find nothing in the Charter or the Letters Patent constituting this Court which would justify this Court in arrogating to itself a power such as this when we find that it is not expressly conferred on it by specific legislation.

8. While on this point I might say here that that portion of the Consent Decretal Order under discussion which purports to vest a portion of the plaintiff's property in the Special Commissioner far from being an order in furtherance of ' substantial justice' was obtained in furtherance of a scheme to defraud the minor plaintiff in the suit.

9. It is further argued that after all there has been a mere irregularity and that the irregularity consisted in describing Mr. Manker as Special Commissioner instead of, a Receiver. The proper word for what was done is not the word 'irregula-rity' but the word 'subterfuge.' This was no inadvertence. It was designedly done. Mr. Manker in 1905 was for many years, has been, and still is, a practising Barrister and he could not have accepted the office of a Receiver. He was therefore C designedly and purposely appointed a Special Commissioner to get over that difficulty. I doubt again if the Court quite independently of the Bar Rules would have appointed a practising Barrister a Receiver of a large estate belonging to a minor and that too without a security. Although the Bar Rule has been subsequently to this decretal order abrogated I have not yet known of a practising Barrister being appointed Receiver with or without security.

10. I also disagree with Mr. Talyarkban's argument when he says 'Mr. Mankar was Commissioner for sale. That at all events was a good appointment. He had anyhow power to enter into an agreement to sell.' So far as I can see 'A Special Commissioner for sale or for entering into an agreement to sell' is not known to the law. The Civil Procedure Code has specific provisions for the appointment of Special Commissioners and these provisions are supplemented by the Rules framed by this Court Neither in the Code nor in the Rules is there any provision for appointing a Special Commissioner for sale or a reference to any such appointment.

11. The learned Counsel next argued that this Court had jurisdiction under Section 375 of the Civil Procedure Code to make any order that the parties agreed upon and asked the Court to make and he refers to Rule 518 which enables the Court to authorise one of its officers to execute conveyances of other persons' properties. Section 375 of the Civil Procedure Code merely empowers to record a lawful agreement of compromise' or satisfaction of plaintiff's claim and pass a decree in terms of such agreement compromise or satisfaction. If parties to a suit choose to come to an agreement which contains a term which is not lawful and the Court inadvertently records that agreement and passes a decree it cannot I think be afterwards contended that because the parties agreed and because the Court made the order that thereby what was unlawful in the agreement or compromise has become lawful If the Court had no power or jurisdiction to appoint a Special Commissioner for the sale of immoveable property of a party to a suit and to vest such property in such Special Commissioner then any order the Curt is led inadvert-ently to make is ab initio bad and no agreement between the parties can validate what the Court had no power or jurisdiction to do.

12. As to Rule 518, it has no applicability to the question under discussion. It refers to the execution conveyance where necessary parties to a conveyance are under certain disabilities or where they are contumacious 'and refuse or neglect to execute a conveyance.

13. The learned Counsel further contended that the decretal order of the 26th of February 1906 appointing Mr. Manker Special Commissioner for sale and vesting a portion of the plaintiff's property in such Special Commissioner was justified under the provisions of Section 32, para 2, of the Indian Trustee Act being Act XXVII of 1866. This contention of Mr. Talyarkhan requires careful consideration for if the second paragraph is read by itself independently of the first paragraph and omitting the first four words 'in every such case '' the reading at first sight may lead one to suppose that the contention was well founded. In order to understand the provisions of Section 32 of the Indian Trustee Act it is necessary to study the Act itself very carefully and to ascertain the scheme of the Act before one can appreciate correctly the scope of its provisions. It is entitled the Indian Trustee Act and it is an Act 'to consolidate and amend the laws relating to the conveyance and transfer of property in British India vested in Mortgagees and Trustees.'

14. It is an enabling Act empowering the High Court to assist in the conveyance of estates where owing to disabilities certain parties such as a lunatic, Trustee or a Mortgagee of unsound mind cannot legally convey. It also empowers the High Court to transfer stock or Government Securities of lunatic Trustees or Mortgagees to 'any' person. It also confers similar powers on the High Court in cases of property standing in the name of a lunatic Executor or Administrator of a deceased person's estate or where a minor holds immoveable property upon Trust or by way of Mortgage. It provides for conveyance of property vested in a Trustee out of the Jurisdiction of the Court or in a Trustee of whom it is not known 'whether he be living or dead' or in a Trustee who 'shall have died intestate without an heir or shall have died and it shall not have been known who is his heir or devisee,' or in Trustee who ' has wilfully refused or neglected to convey'' etc. The whole scheme of the Act in short is to enable the High Court to assist in the conveyance and transfer of immoveable property, Stock or Government Security vested in Trustees or Mortgagees, Executors or Administrators who are owing to certain disabilities unable to legally transfer or convey such property or who being out of jurisdiction or not known to be living or dead are out of the reach of the Court's orders. Section 20 of the Act empowers the High Court to appoint a person to con-vey property in certain cases and Section 32 deals with a decree or order... made by the High Court...directing the sale of any immoveable property.'

15. The first para of this section provides that 'every person holding such property' meaning property ordered to be sold by a decree or order of the High Court, 'shall be deemed so to hold...upon a Trust within the meaning of this Act.'

16. The second paragraph empowers the High Court in 'every such case...to make an order vesting such property...either in any purchaser or in such person as the Court shall direct.' The marginal note to the second para of this section throws a flood of light on the real scope and meaning of the section and leaves no doubt whatever that the vesting here intended is to be vesting '' in lieu of conveyance.'' The '' person holding such property'-contemplated in the first para of the section could not be the legal as well as the beneficial owner of the property for it is hardly conceivable that the legislature intended to divest the beneficial owner of immoveable property of his legal rights to that property by transferring him into a trustee and then clothing another man with a legal title to that property by vesting it in him.

17. The vesting order contemplated by this section is for the purpose of 'carrying such sale into effect' and not for the purpose of making or effecting a sale as was done in this case. The vesting of the property is not in this section intended to bring into existence a person enabling him to convey to some one else but it is 'in lieu of conveyance.' It is to take the place of a conveyance and operate as a conveyance and no further conveyance is contemplated. The vesting of the property is to be ' in any purchaser or in such other person as the Court shall direct.'' The 'such other person' contemplated in this paragraph must I think be taken to mean such other person nominated by the purchaser. The purchaser may be the agent of some one really buying the property or he may wish to have the property conveyed to some nominee of his and the latter provision is intended to enable the Court to vest the property in a purchaser or some nominee of his.

18. I am therefore clearly of opinion that Section 32 of the Indian Trustee Act has no application whatever to the present case and does not justify the Decretal Order of the 26th of February 1906 vesting the plaintiff's property in the Special Commissioner This question is unfortunately not covered by any authority directly in point. It seems that the question incidentally arose before the late Mr. Justice Tyabji in the ease of Fatmabai v. Abdool Succoor (1904) 6 Bom. L.R. 1140. In that case our present Chief Justice, then the Advocate-General is reported to have argued:

Section 32 of Trustee Act has the object to vest property in the purchaser-not in the Receiver. Court cannot vest property in Receiver.' The Judgment however does not deal with this question but the argument there advanced is in consonance with the view I take of the scope of this section that the vesting contemplated there is not for the purpose of enabling the person so vested to execute a conveyance in favour of another person but is intended to take the place of a conveyance and to operate in lieu of a conveyance in favour of a purchaser or his nominee in very much the same way as an order made by the Court vesting trust property in Trustees newly appointed by the Court.

19. Another very strong ground for holding that Section 32 of the Indian Trustee Act has nothing whatever to do with the Decretal Order under discussion is the fact that this order was not made under the provisions of the Act. The proper mode of obtaining an Order under this Act is by petition as will appear from Lackers-teen v. Rostan ILR (1887) Cal. 32. Here we have an order contained in a consent Decree obtained under the provisions of the Civil Procedure Code in a suit instituted on the Original Side of the High Court. The Indian Trustee Act was not within the contemplation of any one concerned in obtaining the Decree and its provisions are now brought into requisition as a last deplorable attempt to justify an order which cannot be justified under any of the provisions of the Civil Procedure Code or Rules framed by the High Court.

20. So far as I know this is the first time the power of the Court to appoint Special Commissioners for sale and vest immovable properties in them is directly and specifically challenged in the pleadings of a suit. But it is by no means the first time that the question has been raised. About the end of 1906 soon after I took my seat on the Bench a Consent Decree was proposed to be taken before me containing provisions for the appointment of Special Commissioner for sale of immovable property and vesting the property in them. I refused to pass the Decree and invited Counsel to argue the question whether the Court had power to pass such a Decree. I was asked to give them time to consider the question but on the day to which the matter was adjourned instead of arguing the question Counsel came with an altered Decree from which was deleted all reference to Special Commissioner.

21. Mr. Padshah informed me that previous to the incident mentioned above the Chief Justice then Mr. Justice Scott on the 14th of August 1904 refused to pass a decree containing similar provisions in suit No. 288 of 1906 and that the proposed decree was subsequently modified before it was passed by the learned Judge. I find that this information is perfectly correct. Here I think it would be desirable shortly to examine the various provisions in the Civil Procedure Code and in the High Court Rules for the appointment of Special Commissioners.

22. Chapter 25 of the Code deals with the appointment of Commissioners. The sections in this chapter are grouped in five heads marked respectively with the first five letters of the alphabet.

23. Sections 383 to 391 grouped under A relate exclusively to Commissions for the examination of witnesses; the next two Sections 392 and 393 under B relate to the appointment of Commissioners for local investigation. Sections 394 and 395 under C relate to Commissions for the examination of accounts. Section 396 under D relates to commissions to make partition and the remaining sections in this chapter 397 to 400 under E embody general provisions relating to the various kinds of Commissions that may be issued by the Court under this Chapter. A commission for the sale and conveyance of property is absolutely unknown to the Civil Procedure Code and it seems to me in the face of these provisions for Commissions for various purposes, it would be a most unwarrantable assumption for the Court to arrogate to itself the power of issuing Commissions for the purpose of effecting sales and executing conveyances.

24. This view receives considerable emphasis when we turn to the Rules framed by this Court.

25. Chapter 28 contains Rules relating to the office of the Commissioner for taking accounts. Of the Rules contained in this Chapter Rules 450 to 459 apply to Special Commissioners. These Rules contain no reference to sale but are intended to regulate procedure before the Commissioner of this Court or Special Commissioner appointed for the purpose of taking accounts.

26. That the Commissioner of this Court may Be directed or authorised by an Order or Decree of the Court to sell property appears very clear from Rules 470 and the following Rules up to Rule 538 which regulate and lay down the procedure the Commissioner is to follow in conducting such sales as he may be directed to carry out. There are some notable provisions in these Rules-which may with advantage be noticed here in view of some of the questions which arise in respect of the sale impugned in this suit. Rule 471 provides that the sale of the property directed to be sold by the Commissioner shall

unless otherwise ordered '.........'be made by public auction.' Rule 472 lays down that 'the sale shall be to the best purchaser that can be got for the same' and that only where ' the Commissioner shall consider that a sufficient sum has been offered.' Under Rule 473 the plaintiff or the party having the carriage of the general proceedings 'is to have ' the carriage of the proceedings relating to the sale ' unless a Judge by his order commits the carriage of such proceedings to 'any other party.' Rule 499 is most peremptory and lays down that no sale of immovable property made under that Chapter shall become absolute until it has been confirmed by the Court.

27. It must be borne in mind that although the Court directs the Commissioner for taking accounts to sell property in certain cases it has no power whatever to vest the property to be sold in him. There is no provision in the Civil Procedure Code for vesting the property to be sold in the Commissioner of the Court much less in a Special Commissioner and in the Rules most elaborately trained there is no reference whatever to any such vesting. After the Commissioner sells-it is the parties interested in the property who convey and not the Commissioner and when a necessary party to a conveyance is a minor or is under some other disability to legally execute a conveyance or being a sui juris neglects or refuses to convey. Rule 518 provides a particular form of procedure enabling the parties to obtain an order ' appointing the Commissioner to convey the property ......and execute the conveyance/or him and in his name.'

28. Again a Receiver appointed under the provisions of the Civil Procedure Code stands in quite a different position from a mere Special Commissioner. Under the powers conferred on the Court by Section 502 of the Code, the Court appointing a Receiver of property either moveable or immoveable could remove the person in whose possession or custody such property may be and commit the same to the custody or management of such receiver. The Court could confer on such Receiver ' all such powers.......for the realisation, management, protection preservation and improvement of the property.......and the execution of instruments in writing as the owner himself has.'

29. In the case of Fatmabai v. Abdul Sucoor (1904) 6 Bom. L.R. 1140, to which I have referred above, Mr. Justice Tyabji has held that the word 'Realise' means ''to convert into money that is to sell' and therefore if the Court has power to authorise a Receiver to realise immoveable property it would mean that he would be authorised to effect the sale of such property and he could fee legally authorised to execute a conveyance of that property in favour of the purchaser from him for a conveyance of the property is an ' instrument in writing which the owner has power to execute,' and the Court could confer on the receiver under the provisions of Section 502 of the Code the same powers to execute instruments in writing as the owner has.

30. It will thus be seen that under the special powers conferred on the Court by a particular enactment of the legislature the Court in certain cases and under certain circumstances has the power to dispossess the owner of property and authorise a person nominated by the Court a receiver of such property and confer on such receiver the power to sell and convey such property to a purchaser. It is a very noticeable circumstance that the section makes no mention of vesting a property in a receiver and therefore it appears to me that the argument of the Advocate-General in in Fatmabai Abdul v. Succuoor that 'the Court cannot vest property in a receiver' to be perfectly sound. The Court can, without vesting immoveable property in a receiver, always order that a receiver may be put in possession of such property and empower him to realise, that is, sell such property and convey the same to his purchaser. I hold that the Court has no power or jurisdiction whatever-inherent or conferred-first, to appoint a Special Commissioner for sale of immoveable property, secondly, to vest immoveable property in a Special Commissioner, and lastly, to empower any such Special Commissioner to execute a conveyance of such property.

31. The result of my findings on the consent decree of the 26th February 1906 is that those provisions therein which purport to vest the plaintiff's property in Mr. Mankar to confer upon him the power to effect a sale of a portion thereof and to authorise him to execute a conveyance in favour of the purchaser are invalid and of no effect whatever-the Court purporting to confer such power and authority having no jurisdiction or power to do so.

32. [His Lordship then adverted to other phases of the case, which are not material to the purposes of the report. His Lordship held on the merits that the sale of the plaintiff's property which the defendant No. 2 purported to make to defendant No. 1 was not a valid sale and was not binding on the plaintiff: it was accordingly set aside.]


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