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The Official Liquidator, Peoples Insurance Company Ltd., (In Liquidation) Vs. Mangal Singh Etc. - Court Judgment

LegalCrystal Citation
SubjectCompany
CourtDelhi High Court
Decided On
Case NumberExecution Appeal No. 8 of 1967 and Civil Original Appeal No. 7 of 1957
Judge
Reported inAIR1970Delhi58; ILR1969Delhi522
ActsDisplaced Persons (Compensation and Rehabilitation) Act, 1954 - Sections 8
AppellantThe Official Liquidator, Peoples Insurance Company Ltd., (In Liquidation)
RespondentMangal Singh Etc.
Advocates: K.K. Raizada and; G.S. Vohra, Advs
Cases ReferredSpence v. Coleman
Excerpt:
displaced persons (compensation and rehabilitation) act (1954), section 8 - compensation under--whether property capable of attachment.; (repelling the contention of the counsel for the judgment-- debtor, namely, that till the mode of payment under section 8 of the displaced persons (compensation and rehabilitation) act, 1954 had been determined, there was no debt due to a displaced person that could be attached, that the compensation payable to the estate of the deceased judgment debtor is a property capable of attachment. ; application under section 151 and order 21 rule 11 and 46, 52, 56 & 64 of the code of civil procedure. - .....and the decree-holder claims a sum of rs. 31.400.00against the estate of late s. sardul singh caveeshar, now represented by his son major k. s. caveeshar, on the basis of the order dated 30/08/1965, passed by the punjab high court in letters patent appeal no. 114 of 1962, whereby s. sardul singh caveeshar was settled on the list of contributories of peoples insurance company limited (in liquidation) (hereinafter referred to as 'the company' and a sum of rs. 31,400.00 determined as payable by the contributory. the company made an application for attachment before judgment under order 38,rule 5, civil procedure code (petition l.m. no. 66 of 1957) on or about 14/05/1967, and an order was made attaching the compensation payable to s. sardul singh caveeshar under the displaced.....
Judgment:

S.K. Kapur, J.

(1) This is an application for execution filed by the Official Liquidator, Peoples Insurance Company limited(in liquidation) and the decree-holder claims a sum of Rs. 31.400.00against the estate of late S. Sardul Singh Caveeshar, now represented by his son Major K. S. Caveeshar, on the basis of the order dated 30/08/1965, passed by the Punjab High Court in Letters Patent Appeal No. 114 of 1962, whereby S. Sardul Singh Caveeshar was settled on the list of contributories of Peoples Insurance Company Limited (in liquidation) (hereinafter referred to as 'the company' and a sum of Rs. 31,400.00 determined as payable by the contributory. The company made an application for attachment before judgment under Order 38,rule 5, Civil Procedure Code (Petition L.M. No. 66 of 1957) on or about 14/05/1967, and an order was made attaching the compensation payable to S. Sardul Singh Caveeshar under the Displaced Persons (Compensation and Rehabilitation) Act, 1954.On 16/08/1967, Jagjit Singh, J., while issuing notice on the execution petition to Major K. S. Caveeshar, ordered that 'the Chief Settlement Commissioner, New Delhi, be requested to remit the amount to the Court which has fallen due under the attachedclaim'. Various objections were taken on behalf of Major K. S.Caveeshar to the execution application and on pleadings of the parties as many as ten issues were framed. It is necessary only to refer to issue No. 1 as the learned counsel for Major K. S.Caveeshar confined his arguments only to that and did nto touch any other issue. The said first issue reads-

'CAN the Official Liquidator proceed against theclaims, which have been verified in the name of Shri Sardul Singh Caveeshar?'

(2) The position as to the claim has been disclosed by Shri RadhaKrishan (DHW 1), a Settlement Officer since 25/08/1962.He said that the total claim verified in favor of late S. Sardul Singh Caveeshar was Rs. 5,63,596.00; that after adjusting the payment already made, a sum of Rs. 82.844.00 was payable to S.Sardul Singh Caveeshar; that because of the death of S. Sardul Singh Caveeshar the amount was payable to his estate 'but in view of the directions of this Court we have taken no steps for making payment to anyone. We will have to bring the legal representatives of the deceased on record under section 9 of the Displaced Persons (Compensation and Rehabilitaiion) Act,1954, before making the payment. There is now no other impediment in making the payment except (1) bringing the legal representatives under section 9 on record; and (2) verifying whether or nto late Sh. Sardul Singh Caveeshar made any other commitment with respect to his claim by way of association before the receipt of the order of attachment from this Court'; and that the Department had no objection to the attachment 'but we have to verify the net amount due to Shri Sardul Singh Caveeshar's estate after meeting the commitments, if any, made by him before the receipt of the attachment order'.

(3) The only point raised by Mr. Vohra, the learned counsel for Major K. S. Caveeshar, was that the compensation payable to a displaced person, nto being a property, could nto be attached. Section 8 of the Displaced Persons (Compensation and Rehabilitation) Act, 1954, deals with the form and manner of payment of compensation. This section provides that 'a displaced person shall be paid out of the compensation pool the amount of net compensation determined under sub-section (3) of section 7 as being payable to him and subject to any rules that may be made under this Act, the Settlement Commissioner or any other officer or authority authorised by the Chief Settlement Commissioner in this behalf may make such payment in any one of the following forms or partly in one and partly in any other form,namely. .........' The section then sets out the various forms in which the payment may be made, such as, in cash or in Government bonds or by sale to the displaced person of any property from the compensation pool and setting off the purchase money against the compensation payable to him. Section 14 provides for the constitution of a compensation pool and also about what the compensation pool shall consist of. Section 15 exempts the property in compensation pool from processes of Courts and provides-

'NO property which forms part of the compensation pool and which is vested in the Central Government under the provisions of this Act shall be liable to be proceeded against for any claim in any manner whatsoever in execution of any decree or order or by other process of any Court or other authority.'

(4) Mr. Vohra argued that the effect of these provisions was to render the compensation payable to a displaced person immune from any attachment. He said that till the mode of payment had been determined under section 8, there was no debt due to a displaced person that could be attached. Reliance was placed by Mr.Vohra on Tirath Ram Lal Chand v. M/s. Mehar Chand Jagan Nath, in which K. L. Gosain, J. decided-

'IT cannot, thereforee, be said at this stage whether the Government will pay any amount at all in cash nor can it be said as to what form the compensation will ultimately take. At the moment, thereforee, the Government cannto be deemed to have become the debtor qua any particular sum payable by it nor can the claimants be deemed to be creditors qua the said amount. Till the Government make a tender of any cash amount the money lying in the compensation pool remains part of that pool and is in my opinion exempt from attachment under the provisions of section 15 of the aforesaid Act.'

(5) Gosain, J. relied on Sunder Das v. Secretary of State, and Spencev. Coleman. Mr .Vohra also depended on these two decisions.

(6) Mr. Raizada, the learned counsel for the decree-holder,on the other hand, referred to Shri Thakar Dass v. The Chief Settlement Commissioner, New Delhi and others, ; K. B. Cooperative Credit Bank v. S. Verma', and Harnam Singh v. K. Puri. In Thakar Dass's case, the judgment of Gosain. J.does nto appear to have been placed before Mahajan, J. Mahajan, J. decided that after the determination of the amount of compensation there is no option left to the Department but to pay the same. The manner of payment has no doubt been left to the discretion of the authority concerned but it cannto be withheld and, thereforee, 'the right to receive compensation is certainly property as creditor's right to recover a debt is property'.The compensation due was consequently held to vest in the Official Receiver by operation of law. In Harnam Singh's case a Division Bench of the Punjab High Court dissented from the view taken by Gosain, J. and approved that of the Bombay High Court in K. B. Co-operative Credit Bank's case. The view of Mahajan, J. was also approved. In K. B. Co-operative Credit Bank's-case, Patel J. held :-

'READING sections 7 and 8, it is clear that once the amount of net compensation payable to the displaced person is determined, the Government is bound to make the payment in accordance with the provisions of section 8. How it will discharge the payment is no doubt within the discretion of the officer concerned, but the amount must be paid and there cannto be any evasion of the payment. It is, thereforee, clear that the Legislature intended that once the amount payable was determined, it become debt payable to the displaced person. Ordinarily a debt is payable in money and nto in kind. The legislature made an exception to this ordinary rule and provided that it could be discharged in one or more of the several modes provided in section 8 Nonetheless, in view of the obligatory nature of the duty to make the payment, it must be regarded as a debt.'

(7) Now it remains to consider the decisions relied upon by Mr. Vohra. In Sunder Das's case, the Lahore High Court decided that the compensation money awarded under the Land Acquisition Act could nto be attached by a creditor until the amount was tendered under section 31 of the Land Acquisition Act because money in the hands of the Collector belonged to the Government until the tender was made. As observed by Patel, J. in K.B. Co-operative Credit Bank's case, it is nto possible to ascertain from the statement of facts as to whether possession had been taken by the Collector in the acquisition proceedings.Under section 48 of the Land Acquisition Act it is open to the Government, except in the case provided for in section 36, to withdraw from the acquisition of any land of which possession has nto been taken. In any case, even if section 31 be susceptible to the construction placed by the Lahore High Court, it bears no analogy to the provisions of the Act under consideration.The determining factor always is whether there is a debt due to the person whose property is sought to be attached. The ratio of the Lahore High Court decision also is the same, which appears from the following observation :-

'THE Land Acquisition Act is a complete Code initself, and until the tender is made, the person whose land has been acquired, does nto become a creditor or the Collector a debtor.'

(8) That position does nto obtain under the Displaced Persons (Compensation and Rehabilitation) Act. The amount of compensation determined, and which has been determined in this case,becomes, by virtue of section 8, a debt due to the displaced person.The fact that a discretion is left with the authority concerned to pay it in one or other of the modes prescribed cannto affect the position and it remains property notwithstanding the discretion as to the mode of payment. The case of Spence v. Coleman is also distinguishable on the same ground. There also the Court decided on the construction of the relevant provisions of law that there was no debt due to the judgment-debtor. Patel,J. in the Bombay case has distinguished Spence's case and I am in respectful agreement with the same. In my opinion, thereforee,there is no force in Mr. Vohra's contention and the compensation payable to the estate of late S. Sardul Singh Caveeshar is a property capable of attachment.

(9) That leaves the question of mode of realisation. The discretion as to the mode of payment vests in the authorities concerned. I would, thereforee, appoint the Official Liquidator as Receiver to realise the payment, to the extent due to the company,from the authorities under the Displaced Persons (Compensation and Rehabilitation) Act in the same manner as it would have been paid to S. Sardul Singh Caveeshar. The Receiver being the Official Liquidator will nto be entitled to any extra remuneration for this work.

(10) The execution application is, thereforee, allowed but with no order as to costs.


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