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In Re: Dr. Abinash Chandra Banerji - Court Judgment

LegalCrystal Citation
SubjectContract
CourtAllahabad
Decided On
Reported inAIR1932All262
AppellantIn Re: Dr. Abinash Chandra Banerji
Excerpt:
- - it may well be that at the time when the surety furnished security, the administrator was honest and was believed to be capable of administering the estate in a proper way but ho might subsequently become dishonest or might mismanage the estate, and so it would be astonishing if there wore no provisions of law which would give the surety remedy by way of objecting to the court and asking to be relieved. he cannot merely sit idle and watch the administrator committing the waste and misappropriation, knowing fully well that the liability will be his own. 4. it seams to us that when the guarantee or undertaking is given to the court itself, there is nothing to prevent the court, if satisfied, when good cause is shown, from cancelling that undertaking. on the same analogy it would seem..........act. but that case is no authority for the proposition that the high court to which the security bond is given has no power whatsoever to relieve the surety from all future liability. the case directly in favour of the applicant is raj narain mookerjee v. fulkumari debi [1902] 29 cal. 68 although it wont to a length to which it is not necessary for us in this case to go. that case accordingly was not approved of by the madras high court in the case of in the matter of arthur gerald norton [1910] 33 mad. 373. the case decided, by their lordships of the privy council in debe.ndra nath v. administrator-general of bengal [1908] 35 cal. 955, is distinguishable because their lordships merely held that the security bond given by the surety did not become void when the letters of.....
Judgment:

Sulaiman, Ag. C.J.

1. This is an application by the surety for Dr. P.D. Banerji who was at one time appointed an administrator of the estate of his deceased father Dr. Abinash Chandra Banerji.

2. A preliminary objection is taken to the hearing of this application on the ground that there is no provision of law under which a surety can be discharged and the High Court has no jurisdiction to entertain such an application. Reliance is placed by the learned Counsel for the opposite party on the case of Kandhya Lai v. Manki [1909] 31 All. 56 but in that case the learned Judges did not expressly lay down that they had no jurisdiction to direct that a surety be discharged. They certainly held that he could not of his own free will withdraw from his suretyship and they also remarked that there was no express provision in the Probate and Administration Act. But that case is no authority for the proposition that the High Court to which the security bond is given has no power whatsoever to relieve the surety from all future liability. The case directly in favour of the applicant is Raj Narain Mookerjee v. Fulkumari Debi [1902] 29 Cal. 68 although it wont to a length to which it is not necessary for us in this case to go. That case accordingly was not approved of by the Madras High Court in the case of In the matter of Arthur Gerald Norton [1910] 33 Mad. 373. The case decided, by their Lordships of the Privy Council in Debe.ndra Nath v. Administrator-General of Bengal [1908] 35 Cal. 955, is distinguishable because their Lordships merely held that the security bond given by the surety did not become void when the letters of administration were cancelled and that while they remained unrovoked, the grantee was to all intents and purposes administrator of the estate and for his acts and defaults as administrator the sureties were and remained responsible.

3. It seems to us that although it is true that a surety cannot claim as of right to be relieved of all liability by merely expressing his intention to do so either by notice or by a proper application to the Court and, although it is also true that the case of a surety whose security has been accepted by a Court, cannot be treated as one falling under Sections 129 and 130, Contract Act, so as to entitle him to put an end of the guarantee at his will. yet that is quite a different thing from saying that the High Court to which the guarantee is given has itself no power to exonerate the surety from all liability for future transactions. It may well be that at the time when the surety furnished security, the administrator was honest and was believed to be capable of administering the estate in a proper way but ho might subsequently become dishonest or might mismanage the estate, and so it would be astonishing if there wore no provisions of law which would give the surety remedy by way of objecting to the Court and asking to be relieved. He cannot merely sit idle and watch the administrator committing the waste and misappropriation, knowing fully well that the liability will be his own. Similarly there may be a case where the security bond becomes inoperated subsequently as where after a security bond is accepted by the Court the surety becomes an insolvent. If the preliminary objection is sound, the Court shall become functus officio after the earlier document was filed, and would ha unable to direct a fresh security to be filed by another surety.

4. It seams to us that when the guarantee or undertaking is given to the Court itself, there is nothing to prevent the Court, if satisfied, when good cause is shown, from cancelling that undertaking. In the present case the letters of administration were subsequently revoked because it was found that the administrator had omitted to bring to the knowledge of the Court certain facts relating to a will of the deceased which had been said to remain in his possession at the moment of revocation, and the administrator ceased to be liable from the administration of the estate. We think that this is a sufficient ground for the surety to be relieved from all further Iliability from a date when full accounts are rendered and the assets duly accounted for. In ordinary cases of surety for appearance of the parties there is express provision in the Civil Procedure Code for release. Similarly the surety can under certain circumstances be relieved from further liability under the Contract Act. On the same analogy it would seem that we have full power to grant release if satisfied that there is ground for it, after providing safeguards for the heirs of the deceased. Such release however will only be operative after the date of the release and the surety will continue to be liable for any maladministration that might hereafter be discovered and which was committed prior to the date of release. We accordingly overrule the preliminary objection.

5. It however appears that the opposite party does not think that the account has been fully rendered. We accordingly allow three mouths time for the opposite party to file written objections of which a copy should be supplied to the applicant accordingly.


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