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Kanailal Jalan Vs. Manoo Bibi and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata
Decided On
Judge
Reported inAIR1919Cal269,51Ind.Cas.394
AppellantKanailal Jalan
RespondentManoo Bibi and ors.
Cases ReferredLevenia Ashton v. Madhabmoni Dasi
Excerpt:
receiver, appointment of, effect of - possession of receiver, whether can be disturbed without leave of court--execution of decree--sale of property in custody of receiver, validity of. - .....the hands of a receiver is exempt from judicial process and the purchaser of such property at an execution sale buys at his peril for the sale may be cancelled upon an application to the execution court; in other words, when property is in the custody of a receiver appointed by a court, a sale under an execution issued by another court may be avoided by an appropriate process. in the case before us, however, no steps have ever been taken, either by the receiver or by the beneficiares, for cancellation of the execution sale in which the maharaja became the purchaser. in this view, it is not necessary to consider the effect of the attempt to revive the suit on the original side of this court after it had remained dormant for 17 years and to hold a sale to the prejudice of rights already.....
Judgment:

1. The subject-matter of the litigation which has culminated in this appeal is an one fourth share of a garden which was owned at one time by Gopal Charan Ghose. He left four sons, Chandranath, Suryyakumar, Satyacharan and Kartik charan. Chandranath died in or about the year 1892 and left a son Mohinimohan; the latter died before the commencement of this suit, which concerns the one fourth share of Chandranath. There are three rival claimants to this share, namely, the plaintiff, the Das defendant, and the Maharaja of Burdwan, who was added as a defendant by order of Court, dated 23rd April 1912: The Maharaja of Burdwan purchased the share in execution of a money decree obtained by him against Mohinimohan; the sale took place on the 15th February 1896 and was confirmed on the 18th March 1896. The 1st defendant obtained a lease of the entire garden from Mohinimohan and his three uncles on the 2nd July 907. The plaintiff purchased the share at a sale held on the 2nd September 1907 by the Official Receiver of the High Court who had been appointed Receiver to the estate of Chandranath Ghose in a litigation on the Original Side of this Court, The title of the Maharaja thus accrued many years before that of the plaintiff or the 1st defendant, and the substantial question in controversy is, whether the plaintiff by his purchase at the sale held by the Receiver has acquired a title superior to that of the Maharaja. The primary Court answered his question in favour of the plaintiff; the District Judge has reversed that decision. The circumstances which led to the appointment of the Receiver and the sale held by him must accordingly be narrated here.

2. On the 10th April 1883, Chandranath Ghose executed a trust deed in respect of his share in the paternal properties in favour of Narendranath Sen, an attorney of this Court, to enable the latter to administer the estate and satisfy the debts due to his creditors One of these creditors, Bhagaban Chandra Ray, on behalf of himself and the other creditors, instituted a suit on the Original Side of this Court on the 11th September 1886 against Chandranath Ghose and Narendranath Sen for the construction of the indenture of trust, for the execution of the trusts mentioned therein, for an account, for the appointment of a Receiver and for consequential reliefs. On the 30th May 1887, a preliminary decree was made and the Official Receiver was appointed Receiver in the suit. On the 14th March 1889, an order was made authorising the Receiver to sell the properties included in the trust and an amended order was made on the 3rd March 1890. Chandranath Ghose died in or about the year 1892 and no steps were taken to revive the suit against his son Mohinimohan till 1908. Meanwhile, the transactions under which the Maharaja of Burdwan and the 1st defendant acquired interests in the property had taken place in 1896 and 1907.

3. The District Judge has found that the Receiver never obtained possession of the property, though he was directed to take possession by the vesting order, dated 30th May 1887, and the Ghoses remained in possession independently of the Receiver. It is consequently plain that the Maharaja was entitled to proceed in execution against the property of his judgment debtor. The rule that the possession of a Receiver may not be disturbed without leave, does not apply, so far as third persons are concerned, until a Receiver has been actually appointed and is in possession. It is not enough that an order has been made directing the appointment of a Receiver. Until the appointment has been perfected and the Receiver is actually in possession, a creditor is not debarred from proceeding to execution, The order appointing a Receiver is for the benefit of the parties to the action; it does not affect third persons until the appointment is complete and perfected: Defries v. Creed ((1865) 34 L.J. Ch. 607; 11 Jur (N.S.) 360; 12 L.T. 262; 13 W.R.632.) and Elwards v. Elwards ((1876) 2 Ch. D. 291; 45 L.J. Ch. 391; 34 L.T. 472; 24 W.R. 713. It is further clear that the sale held at the instance of the Maharaja was, at the worst, only voidable. As pointed out in Levenia Ashton v. Madhabmoni Dasi (5 Ind. Cas. 390; 11 C.L.J. 489; 14 C.W.N. 560). property in the hands of a Receiver is exempt from judicial process and the purchaser of such property at an execution sale buys at his peril for the sale may be cancelled upon an application to the execution Court; in other words, when property is in the custody of a Receiver appointed by a Court, a sale under an execution issued by another Court may be avoided by an appropriate process. In the case before us, however, no steps have ever been taken, either by the Receiver or by the beneficiares, for cancellation of the execution sale in which the Maharaja became the purchaser. In this view, it is not necessary to consider the effect of the attempt to revive the suit on the Original Side of this Court after it had remained dormant for 17 years and to hold a sale to the prejudice of rights already acquired by strangers who had no notice of the proceedings in the suit.

4. In our opinion, the plaintiff has not acquired a title enforceable against the Maharaja and his claim has been rightly negatived by the District Judge. The result is that the appeal is dismissed with costs


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