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A. Milton and Co. Ltd. Vs. Ojha Automobile Engineering Co. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Reported inAIR1939Cal145
AppellantA. Milton and Co. Ltd.
RespondentOjha Automobile Engineering Co.
Excerpt:
- .....the decree was transmitted for execution to the court of the subordinate judge of etawah in the united provinces. the decree-holder in 1936 applied in etawah for execution by attaching the interest of dario singh in a mortgage debt executed in his favour by shyam sunder.2. dario objected denying that he was a partner in the firm, and asked for the recall of the decree. on 12th january 1937, terms of settlement were entered into. dario admitted that he was a partner and the defendant firm consented to a decree for rs. 10,000 in full settlement of its claim and costs provided that amount were paid within six months. dario undertook not to alienate or realize any amount due under the mortgage but the mortgagee was at liberty to sue and bring the mortgaged property to sale in execution of.....
Judgment:

McNair, J.

1. This is an application by a decree-holder for the appointment in execution of a Receiver of the right, title and interest of one of the judgment-debtors in a mortgage executed in his favour in 1934, and for liberty to the receiver to sell such right, title and interest. The decree-holder sued in 1929 and obtained a consent decree in December 1932 by which the matters in dispute were submitted to a reference. The referee found in favour of the plaintiff who was given a decree for Rs. 13,487-15-3 with interest and taxed costs Rs. 3773-10-0. The decree was against the defendant firm and execution was ordered against the partners Ojha Dario Singh, (who opposes this application), Ojha Shiva Prasad, and Ojha Gurdial Singh. The decree was transmitted for execution to the Court of the Subordinate Judge of Etawah in the United Provinces. The decree-holder in 1936 applied in Etawah for execution by attaching the interest of Dario Singh in a mortgage debt executed in his favour by Shyam Sunder.

2. Dario objected denying that he was a partner in the firm, and asked for the recall of the decree. On 12th January 1937, terms of settlement were entered into. Dario admitted that he was a partner and the defendant firm consented to a decree for Rs. 10,000 in full settlement of its claim and costs provided that amount were paid within six months. Dario undertook not to alienate or realize any amount due under the mortgage but the mortgagee was at liberty to sue and bring the mortgaged property to sale in execution of a mortgage decree. Dario only paid Rs. 2500 towards the decretal amount and the plaintiff company sold his right, title and interest in the mortgage for Rs. 15,000 and purchased it in the sale on 3rd January 1938. On 6th January 1938, Dario applied to the Etawah Court to set aside the sale under Section 7, U.P. Encumbered Estates Act, as Gurdial Singh, one of his joint debtors, had applied for protection under that Act. The Subordinate Judge on 11th February 1938, set aside the sale.

3. There is no doubt that Dario's application in Etawah was contrary to the terms of settlement of 12th January 1937, but the question which I have to decide is whether the relief now sought is permissible in view of the decision of the Subordinate Judge of Etawah which declared the execution proceedings null and void under Section 7, U.P. Encumbered Estates Act. That Act enables a debtor to apply to the Collector for protection under the Act. The Collector forwards the application to the Special Judge who enquires into the claims and may pass decrees and send them to the Collector for execution according to the scheme of the Act. In the present case Dario has not applied to the Collector, for protection under the United Provinces Encumbered Estates Act, but, such an application has been made by his partner Gurdial. It is argued that this is immaterial, for Gurdial and Dario are joint debtors. Their debt however is both joint and several. And I can see no reason why property which Dario owns should not be taken in execution by his creditors merely because Dario's partner has sought the protection of the United Provinces Act.

4. The full facts however are not before me, nor have I had the advantage of seeing the judgment of the learned Subordinate Judge of Etawah and I have neither the materials nor the desire to question the correctness of the order which he has made. That order however in no way fetters the jurisdiction of this Court and there can be no doubt that the United Provinces Encumbered Estates Act has no applicability outside the Province in which it was enacted. The learned Counsel for Dario, if I understood his argument aright, contended that Section 7 of that Act, restricted all dealings with the property in which a protected debtor might be interested, and forbade any fresh process in execution being issued by any Court whether within or without the United Provinces. That was the manner in which, as I understood him, he invited me to construe the last three lines of Section 7(1)(a) of the Act:

Section 7(1). When the Collector has passed an order under Section 6, the following consequences shall ensue:

(a) All proceedings pending at the date of the said order in any Civil or Revenue Court in the United Provinces in respect of any public or private debt to which the landlord is subject or with which his immovable property is encumbered except an appeal or revision against a decree or order, shall be stayed; all attachments and other execution processes issued by any such Court an then in force in respect of any such debt shall become null and void and no fresh process in execution shall, except as hereinafter provided, be issued.

5. Dario, as I have already said, is not a protected debtor and the sub-section to which he has referred appears to me to refer quite clearly to a 'fresh process in execution' to be issued by a Court in the United Provinces. The Act must have a local application, and the words of the Section do not in my opinion profess to apply to any Court other than a Civil or Revenue Court in the United Provinces. There is nothing in the Act which prevents this Court from appointing a receiver as prayed: The receiver is sought to be appointed not over any immovable property but over the interest of Dario in a mortgage executed by Shyam Sunder. Whether the receiver will' or will not be able to sell the debtor's interest is not a matter with which I am now concerned. I am satisfied that he can-be appointed with liberty to sell. There will be an order in terms of the summons.


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