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Baroda Kanta Sarkar Vs. Rashmani Dasi and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Judge
Reported in28Ind.Cas.25
AppellantBaroda Kanta Sarkar
RespondentRashmani Dasi and ors.
Cases ReferredMohini Mohan Patra v. Baruda Kanta Sarkar
Excerpt:
receiver - adjustment of accounts--receipts by minor for sums in excess of the sanction of court, whether valid discharges--money paid as bribe to police for release of minor--receipt taken from, minor, validity of--liability of person through whom bribe alleged to have been paid--litigation expenses--details necessary--allowance for unavoidable waste of money in conducting litigation--appointment of persons in excess of sanction of court, whether permissible--improper claim of receiver--money deposited accordingly--interest allowed in excess deposit--payment of high rate of interest on account of receiver's improper conduct--separate suit. - .....make it difficult, if not impossible, for the plaintiffs to borrow money for the release of their estate. the plaintiffs ultimately raised money on interest at the rate of 18 per cent, per annum and the deposit was made on the 1st february 1911. upon the account, as now adjusted, it is manifest that the plaintiffs were not bound to make any deposit at all. the plaintiffs are, on the other hand, entitled to receive a large sum from the receiver. the person really liable to deposit the money in court was the defendant, but the amount he was liable to bring into court was not rs. 20,950 but rs. 12,550, namely, the difference between the sum payable by the defendant to the receiver and the sum payable by the receiver to the plaintiffs. the only question is, at what rate interest should be.....
Judgment:

1. The circumstances of the litigation which has culminated in the present proceedings for the adjustment of the accounts of a Receiver, are fully narrated in the previous judgment of this Court, Mohini Mohan Patra v. Baruda Kanta Sarkar 12 Ind. Cas. 78C : 14 C.L.J. 445 and need not be recited here. This Court held on that occasion that the Receiver had not fully rendered his accounts and appointed Babu Haradhan Nav, a Vakil of this Court, to take the accounts. The Commissioner commenced the work, but resigned on the ground of ill-health, whereupon the Court appointed Babu Ashutosh Mukerji, another Vakil of this Court, to take the accounts, with directions to submit his report to the Subordinate Judge of the 24-Perganahs, who had seizin of the partition suit in the course of which the Receiver had been appointed. Before the Commissioner, the proceedings were much protracted, as every single item was fought out by the parties with unusual pertinacity, irrespective of the amount in controversy. The result was that the Commissioner submitted a full report in which he dealt with each disputed point with thereupon filed a memorandum of exceptions in which he not only questioned the correctness of the conclusions of the; Commissioner, but imputed to him grave misconduct. The Subordinate Judge did not investigate the matter on the merits, but reported to this Court that he felt embarrassed as the report of the Commissioner a raised a question as to the propriety of the conduct of a gentleman, who need? not be named here and who had been intimately known to the Subordinate Judge ii for many years. It transpired on inquiry at the same time that there was no other senior officer available in the District who could conveniently take up the case for early e disposal. The Court was consequently called upon to determine what course should be adopted, in the best interests of the parties for the speedy determination of the questions in issue, and this Bench was specially constituted by the Chief Justice to deal with the matter. After anxious consideration of all the circumstances of the case, we decided to transfer the proceedings for the adjustment of the accounts of the Receiver from the Court of the Subordinate Judge to this Court, to be tried in the exercise of our extraordinary original civil jurisdiction. The order was accordingly made, and the proceedings are now before us for final disposal. In this Court, the learned Counsel for the Receiver, who has put the case before us with great fairness and clearness, has unreservedly withdrawn the imputations made against the Commissioner and has confined himself to such items in the accounts as really call for consideration. We now proceed to examine the exceptions to the report in the order in which they have been placed before us.

2. The first group of items to which exception is taken by the Receiver conies under the head of maintenance. The Commissioner has disallowed several items which in the aggregate amount to Rs. 388-8-0 and may be arranged in two classes first, the sums paid to one of the plaintiffs, Mohini Mohan Patra, who was at the time an infant; and, secondly, a sum of Rs. 200 which was raised by way of loan by the Receiver on his personal undertaking under somewhat exceptional circumstances.

3. As regards the items included in the first class, it has been argued on behalf of the Receiver that the Receipts granted by Mohini Mohan Patra constitute a valid, discharge, but this contention cannot possibly succeed. Mohini Mohan Patra was an infant at the time these sums are alleged to have been paid into his hands. His natural guardian was his mother who was acting as his next friend for the purposes of the suit. The Court had sanctioned specific sums for the maintenance of the mother and her two sons, namely, Rs. 75 for the mother and Rs. 50 for each of her sons. The sums now in controversy are not included in the sanctioned amounts of monthly allowances. It is not necessary for us to determine whether, under any circumstances, receipts granted by an infant for payments made to him by the Receiver in excess of the amount sanctioned by the Court, are valid discharges. In the present case, it has not been shown that these sums were applied for the benefit of the infant; consequently, it is impossible for us to accede to the contention that Mohini Mohan Patra or his representative is liable to be charged with the sums named.

4. The sum of Rs. 200 included in the second class was spent by the Receiver under very exceptional circumstances. On the 22nd December 1909, Mohini Mohan Patra, who was a young man of dissolute habits, was arrested by the Police as he was found drunken and disorderly in the public streets. Thereupon his relation (the defendant in the suit) and one of the officers of the Receiver applied to the latter for money to secure the release of the young man from Police custody. The Receiver, it is alleged, raised this sum of Rs. 200 by a loan on his personal guarantee. The sum carried interest at the very high rate of 48 per cent, per annum. The story is that this sum was placed in the hands of Ram Narayan Patra (the defendant) and Jogendra, the officer of the Receiver, and that they applied it in the payment of what must be regarded as a bribe to the Police to obtain the release of the young man from custody. No doubt, there is no direct evidence that the money was so applied, but we cannot very well expect that evidence will be available to establish that the bribe was as a matter of fact paid. It is further worthy of note that when the Receiver reported the incident to the Court, he did not state that he had raised the sum by way of loan at an exorbitant rate of Interest. In fact, if he had reported to the Court the details of the incident and the manner in which the money raised was intended to be applied, he would have found himself in a position of great embarrassment. It is plain that so far as Mohini Mohan Patra is concerned, the expenditure must be deemed wholly unauthorised and disallowed on that ground. But it has been argued for the Receiver that as the money was put into the hands of the defendant, Ram Narayan, the Receiver is entitled to credit as against him. This argument is obviously unsustainable. The books of the Receiver show that this money was credited in the accounts of Mohini Mohan Patra, and as a matter of fact a receipt was obtained from Mohini Mohan Patra for this amount. The Receiver plainly acted as though he had placed the money into the hands of Mohini Mohan Patra, to be applied by the young man in the payment of a bribe to the Police. Under these circumstances, it is not open to him now to turn round and set up a claim as against Ram Narayan. On the other hand, it is more than probable that if Ram Narayan had been informed by the Receiver that the money could be paid to him only on his personal responsibility, Ram Narayan would never have assumed that liability. We may add that in assuming that the money was, as a matter of fact, applied in the payment of a bribe to the Police, we take the view most favourable to the Receiver, because the plaintiffs have suggested that the money was, as a matter of fact, never so applied but was misappropriated by the Receiver or his officer.

5. The result is that all the objections under this head fail, and the report of the Commissioner must be affirmed so far as maintenance allowances are concerned.

6. The necl group of items comprises litigation expenses other than the fees paid to Pleaders, which amount in the aggregate to Rs. 661-9-0. Of these, the principal items are Rs. 110 and Rs. 100, alleged to have been paid to a Vakil of this Court on the 17th September 1909 and the 11th June 1910 in connection with an appeal from original decree pending in this Court. The Commissioner has disallowed these items on the ground that details have not been furnished, though receipts are produced signed by the Vakil.

7. In our opinion, the Commissioner acted properly, and it was not sufficient for the Receiver merely to show that he had paid these sums to a Vakil for the purposes of a certain litigation, specially as one of the receipts shows on the face of it that Rs. 100 was advanced as the probable expenses for preparation of the paper-book in that appeal.

8. We have been invited by the learned Counsel for the Receiver to examine the records of this Court and to ascertain what sum was actually spent, We have done so, and we find that the Vasil in question did file in this Court a memorandum of cross-objections. We, therefore, allow one item, namely, Rs. 110 in full.

9. In so far as the item of Rs. 100 is concerned we find that the costs of preparation of the paper-book of the respondent amounted only to Rs. 4-2. The sum of Rs. 4-2 only will be allowed out of the item of Rs. 100. The fees paid to the Vakil are included in the item of Rs. 100. The total amount allowed under these two items is thus Rs. 114-2-0.

10. The remaining items in the second group consist of small sums spent for the purposes of litigation. Several of these have been examined in detail by us, and it transpires that possibly in a good many instances, although litigation expenses were incurred, there has been an obvious overcharge. Hut it must he borne in mind that a certain amount of money is unavoidably wasted when a suit is instituted and conducted, and the Receiver cannot be expected to do better in this respect than an ordinary prudent man.

11. Under these circumstances, out of the remaining items which constitute an aggregate sum of Rs. 451-9-6, we allow in favour of the Receiver Rs. 300 and the balance of Rs. 151-9-6 is disallowed. The report of the Commissioner on this point is confirmed, subject to this variation. The sum now allowed will be charged as against the estate as a whole.

12. The third head of objections deals with the establishment charges. The Commissioner has disallowed a sum of Rs. 1,241-2. It has been argued before us on behalf of the Receiver that this is not justifiable. We are of opinion that this contention is partly well-founded. Immediately after the Receiver had been appointed, he obtained the sanction of the Court to the creation of a post of superintendent on a salary of Rs. 30 a month, which was filled by him by the appointment of Jogendra Nath Sinha Roy, who, in view of his antecedents, was clearly not a desirable person for the post. The Receiver, subsequently, without the leave of the Court, appointed a cashier on a salary of Rs. 25 a month and a mohuror on an initial salary of Rs. 10, subsequently reduced to Rs. 5. We are of opinion that in view of the fact that a superintendent had been sanctioned, it was not necessary to appoint either a cashier or a mohuerer, and the salary paid to these two persons, namely, Rs. 350 paid to Harendra and Rs. 81 paid to Debendra, amounting in the aggregate to Rs. 431, must be disallowed.

13. The result will be that the exception will be allowed in favour of the Receiver against the estate to the extent of Rs. 810.

14. The fourth head comprises two items, which relate to the Doorga pooja and rash, festivals. The Commissioner has disallowed Rs. 547 in respect of Doorga pooja expenses, but out of this sum he has made the defendant liable to the extent of Rs. 440. The amount really in dispute is thus reduced to Rs. 107. For this sum, the defendant is liable because it is included in the receipts granted by him.

15. As regards rash expenses, the amount disallowed is Rs. 642-1-0, but out of this sum the defendant has been made liable to the extent of Rs. 227-1-0. The amount really in dispute under this head is thus reduced to Rs. 415. This also is covered by the receipt granted by the defendant who must be held liable. We, therefore, direct that Rs. 107, on account of Doorga pooja and Rs. 415, on account of rash, be credited against the defendant.

16. The next head deals with the construction and repair of buildings. The total amount disallowed by the Commissioner is Rs. 263-10-0, composed of several small items. Our attention has been drawn to the evidence and we are of opinion that the exception should be allowed to the extent of Rs. 170. In so far as the Commissioner disallowed the difference, Rs. 93-10-0, his report is confirmed.

17. The following head deals with brokerage. The Commissioner has disallowed the sum of Rs. 322-9-6. We hold that the Receiver is entitled to Rs. 300 only out of this sum as against the defendant.

18. The next following head deals with interest on debts. Here one item of Rs. 1,217-9-6 is in dispute. The Commissioner has disallowed, this sum on the ground that it is claimed as interest on sums raised ostensibly for the purposes of the estate but applied really for the benefit of the defendant. We have, however, already held that sums applied for the benefit of the defendant should be recovered by the Receiver from him, and this necessarily leads to the conclusion that interest on such sums also shonl.1 be paid by the defendant to the Receiver. We allow the exception to the extent of Rs. 1,217-9 6 against the defendant.

19. The next head deals with the question of Pleaders fees. The Receiver claimed on this account Rs. 2,985-10-0. As the Commissioner allowed Rs. 1,128-10-0, the exception of the Receiver relates to the difference, Rs. 1,857. It has now been stated to us that out of this amount, Rs. 1,620 had been paid to Baboo Dwarka Nauth Chuckrabertty, who has now refunded the sum to the Receiver. The position consequently is as if this money had never been spent. The dispute is thus reduced to Rs. 237, and on examination of the evidence, we are of opinion that Rs. 181 should be allowed in favour of the Receiver against the defendant, the balance, Rs. 56, is disallowed. The Receiver undertakes to deposit in Court within two days the sum of Rs. 1,620 refunded by Baboo Dwarka Nauth Chuckrabertty.

20. The next following item relates to expenses in connection with the worship of an idol. A sum of Rs. 17-8-0 has been disallowed by the Commissioner, We allow this sum in favour of the Receiver against the estate.

21. The next head deals with the expenses in connection with the construction and repair of embankments. The Commissioner has disallowed Rs. 376 1-0. We are of opinion that Rs. 250 should be allowed in favour of the Receiver against the estate and the balance disallowed.

22. The Commissioner has disallowed Rs. 429-6-0 under the next head, travelling and halting charges. We allow Rs. 214 in favour of the Receiver against the estate. The balance is disallowed.

23. The next head relates to gharry hire. The sum of Rs. 60-4-0 was disallowed by the Commissioner. We allow Rs. 30 in favour of the Receiver against the estate. The balance is disallowed.

24. The next head deals with the house rent. The amount disallowed by the Commissioner is Rs. 138-8-0. We allow Hs. 70 in favour of the Receiver against the estate. The balance is disallowed.

25. The next head deals with contingencies. The Commissioner has disallowed Rs. 54-15 0. We allow in favour of the Receiver, Rs. 29 against the estate. The balance is disallowed.

26. The next head relates to expenses on account of kerosene oil and tobacco. The sum of Rs 30-8-0. has been disallowed by the Commissioner. We allow in favour of the Receiver the whole of the above sum against the estate.

27. The next head deals with the cost of constructing a sluice gate. The sum of Rs. 11-8 0 has been disallowed by the Commissioner. We allow Rs. 10 in favour of the Receiver against the estate. The balance is disallowed.

28. The next head deals with the expenses in connection with the punya ceremony. The sum of Rs. 165 has been disallowed by the Commissioner. We allow Rs. 83 in favour of the Receiver against the estate. The balance is disallowed.

29. The next head deals with expenses on miscellaneous accounts. The Commissioner has disallowed the sum of Rs. 37-10-3. We allow Rs. 25-8-0 in favour of the Receiver against the estate. The balance is disallowed.

30. The last head deals with Rs. 320 which was in the hands of a gomadah and was not realised. The Commissioner has disallowed this sum. We are of opinion that his decision must be upheld.

31. The accounts when re-adjusted, according to the directions just given, show that the plaintiffs are entitled to get from the Receiver Rs. 2,486, while the Receiver is entitled to get from the defendant Rs 15,036 as well as interest at the rate of 12 per cent, per annum from, the 1st February 1911 upon the sum of Rs. 14,600, which represents the sums borrowed from time to time by the Receiver for the benefit of the defendant. Interest at this rate will be allowed up to the 31st May 1913, consequently a sum of Rs. 4,088 is due to the Receiver from the defendant on account of, interest in addition to the sum of Rs. 15,036 already mentioned. Two questions now require consideration, namely, fist the responsibility of the Receiver and of the defendant for interest on the sum of Rs. 20,950 which the plaintiffs were directed, at the instance of the Receiver, to bring into Court on the 1st February 1911, to have their estate released from his custody, and, secondly, the liability for costs of the Commissioner as also of the hearing before this Court.

32. With regard to the first of these questions, it is to be observed that on the 13th June 1910, the Subordinate Judge directed that the Receiver be discharged. The Receiver then applied to the Court to recall this order on the ground that till the liabilities he had incurred for the benefit of the estate had been satisfied, his possession should not be terminated. The Court, thereupon, on the 23rd June 1910, recalled the previous order and restored the possession of the Receiver. The Court further directed that the estate be released from the custody of the Receiver as soon as his dues are brought into Court. The Receiver subsequently filed a statement of: accounts in which he alleged that he was entitled to get a sum of Rs. 2,950 from the estate. Meanwhile the plaintiffs were endeavoring to raise money with a view to make a deposit. While negotiations were in progress, the Receiver, on the 27th May 1910, wrote a letter to the person who was about to advance the money with a view to dissuade him from the transaction. This letter is on the record, and is of a highly improper character, as it shows clearly that the Receiver intervened to make it difficult, if not impossible, for the plaintiffs to borrow money for the release of their estate. The plaintiffs ultimately raised money on interest at the rate of 18 per cent, per annum and the deposit was made on the 1st February 1911. Upon the account, as now adjusted, it is manifest that the plaintiffs were not bound to make any deposit at all. The plaintiffs are, on the other hand, entitled to receive a large sum from the Receiver. The person really liable to deposit the money in Court was the defendant, but the amount he was liable to bring into Court was not Rs. 20,950 but Rs. 12,550, namely, the difference between the sum payable by the defendant to the Receiver and the sum payable by the Receiver to the plaintiffs. The only question is, at what rate interest should be calculated on this sum. On behalf of the plaintiffs, it has been argued that, but for the improper intervention of the Receiver, they would have been able to raise money on interest at 12 per cent, per annum, and that, consequently, the Receiver should be made liable in damages, in these proceedings, for the extra interest at 6 per cent, on Rs. 12,550 and also for interest at 18 per cent, on the difference between Rs. 20,950 and Rs. 12,550. We were at one stage impressed by this argument, but upon fuller consideration, we hold that this question should not be decided summarily upon affidavits, in these proceedings. The Receiver improperly put forward a claim for Rs. 20,950, while only Rs. 12,550 was due to him; he may be legitimately held liable, when his accounts are adjusted, for interst at 12 per cent, upon the excess deposit. Hut whether or not the plaintiffs were obliged to raise money at a higher rate of interest than usual, by reason of his intervention, is really foreign to this inquiry, and if the plaintiffs have been dandified by reason of his improper conduct, the rights and liabilities of the parties must he determined in a separate suit framed in such manner as the parties may be advised. We hold, accordingly, that the deposit was properly made to the extent of Rs. 12,550; and interest may legitimately be calculated on the excess deposit at the rate of 12 per cent, per annum. The result is that the plaintiffs are entitled to be indemnified in so far as interest upon the sum of Rs. 20,950 at the rate of 12 per cent, per annum is concerned. This up to the 31st May 1918 amounts to Rs. 5,866. Out of this sum, the defendant may rightly be charged with interest at the rate of 12 per cent, per annum upon Rs. 12,550, that is, Rs. 3,514. Tito Receiver must be held responsible for the balance, namely, Rs. 2,352. Consequently, in addition to the sum already found due from the Receiver to the plaintiffs, he must be held liable for the further sum of Rs. 2,352.

33. The second question we have to consider relates to the costs of the proceedings before the Commissioner us also the courts of the hearing before this Court. As regards the costs before the Commissioner, it is manifest that there was a protracted inquiry for which the parties as well as the Receiver must be held responsible. But it cannot be overlooked that the Receiver throughout has resisted an examination of the accounts, and if he had done his obvious duty, the appointment of a Commissioner would have been unnecessary. We, therefore, direct that the Receiver be held responsible for half the costs of the commission, namely, Rs. 1,710. As the plaintiffs have paid the costs of the Commissioner, tin's sum will be paid by the Receiver to the plaintiffs. In so far as the other half is concerned, the plaintiffs will bear a two-thirds share thereof, namely Rs. 1,140, and the defendant will bear an one-third share, namely Rs 570. Consequently, the defendant will pay Rs. 570 on this account to the plaintiffs. As regards the costs of the hearing before this Court, the defendant has not entered appearance and has incurred no costs. The plaintiffs are entitled to get their costs which we assess at ten gold mohurs.

34. The final result may be summed up as follows. The Receiver must pay to the plaintiffs the sum of Rs. 2,486 on the accounts taken. He must also pay Rs. 2,352 on account of interest on the sum which the plaintiffs wore obliged to deposit in Court at his instance. He must further pay Rs. 1,710 on account of costs of the commission and Rs. 160 on account of costs of this Court. The aggregate sum payable by the Receiver to the plaintiffs is Rs. 6,708. The defendant will pay to the Receiver Rs. 15,036 on the accounts taken and Rs. 4,088 as interest on the loan incurred by the Receiver for his benefit. The aggregate sum payable by the defendant to the Receiver consequently amounts to Rs. 19,124. The defendant will further pay to the plaintiffs Rs. 3,514 on account of interest on the sum deposited by the plaintiffs in Court. He will also pay to the plaintiffs Rs. 570 on account of costs of the Commission. The aggregate sum payable by the defendant to the plaintiffs, therefore, amounts to Rs. 4,084. The plaintiffs will have a first charge to the extent of Rs. 6,708 upon the sum of Rs. 19,124 payable by the defendant lo the. Receiver. The plaintiffs; will also have a personal remedy against the Receiver. The Receiver will be personally responsible for the loans that he has incurred, and the estate will not, as between the parties to the present proceeding, be liable on account of those loans.

35. We are informed, that a sum of Rs. 1,950-4-9 is in deposit, namely, Rs. 1,620 refunded by Babe Dwarka Nauth Chuckraberty and Rs. 330-4-9 brought into Court by the Receiver as the cash balance in his hands. The plaintiffs will be entitled to a two-thirds share of this sum, namely, Rs. 1,300-3-2, and the defendant will be entitled to Rs. 650-1-7. The plaintiffs will be at liberty to withdraw whatever now remains in deposit out of the sum of Rs. 20,950. The plaintiffs will also be entitled to apply Rs. 650-1-7, now standing to the credit of the defendant, in part satisfaction of the Rs. 4,084 payable by the defendant. The Receiver will make over to the parties all the title deeds and all the papers of the estate in his custody. The order of this Court as to the payment of the various sums will, if necessary, be executed as a decree of this Court.

36. On the sums now decreed in favour of the plaintiffs, they will be entitled to interest at the rate of 6 per cent, per annum from the 31st May 1913 against the Receiver as also against the defendant. But the Receiver will be entitled to interest at the rate of 12 per cent, per annum upon the aggregate sum allowed in his favour against the defendant. We make this order in favour of the Receiver, on the ground that the major portion of the sum decreed in his favour consists of borrowed money which we understand carries interest at 12 per cent, per annum.


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