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HIGH COURT OF CALCUTTA
Bijayesh Mukherji
JITENDRA NATH MUKHERJEE - Appellant
Versus
COMMISSIONERS OF BADURIA MUNICIPALITY - Respondent
Civil Revn. Case 2878 Of 1966
Decided On : OCTOBER 7, 1966
MUNICIPAL LAW - APPOINTMENT OF RECEIVER - JURISDICTION - SECTION 103 OF THE BENGAL MUNICIPAL ACT, 1932 - INTERPRETATION - LEASE AGREEMENT - VALIDITY - SECTION 53A OF THE TRANSFER OF PROPERTY ACT, 1882 - APPLICABILITY - EQUITABLE ESTOPPEL - RELEVANCE.
Fact of the Case:
The plaintiff, a municipality, filed a suit against the defendant, Jitendra, seeking declarations that an agreement executed between the defendant and the then chairman of the municipality was collusive, illegal, and void, that the defendant had acquired no title to the hat in controversy on the foot of such an agreement, and that the agreement was not binding on the municipality. The municipality also sought consequential relief, including a permanent injunction restraining the defendant from interfering with its possession of the hat and confirmation of its possession by collecting tolls.
Finding of the Court:
The court held that the munsiff had pecuniary jurisdiction to try the suit, rejecting the defendant's contention to the contrary. The court also held that Section 103 of the Bengal Municipal Act applied to the lease agreement in question and that the agreement was not binding on the municipality due to non-compliance with the mandatory provisions of the Act. The court further held that Section 53A of the Transfer of Property Act and equitable estoppel were not applicable in the present case, as there was no instrument of transfer. The court concluded that the appointment of a receiver was just and convenient and dismissed the defendant's rule.
Issues: 1. Whether the munsiff had pecuniary jurisdiction to try the suit. 2. Whether Section 103 of the Bengal Municipal Act applied to the lease agreement in question. 3. Whether the lease agreement was valid and binding on the municipality. 4. Whether Section 53A of the Transfer of Property Act and equitable estoppel were applicable in the present case. 5. Whether the appointment of a receiver was just and convenient.
Ratio Decidendi: 1. The court held that the suit fell under Section 7 (iv) (c) of the Court-fees Act, 1870, and that the amount of fees should be computed according to the amount at which the relief sought was valued in the plaint. The court rejected the defendant's contention that the suit should be valued at Rs. 15,000, the annual income of the hat in controversy, as the relief sought was for a declaration and injunction, and not for recovery of possession. 2. The court held that Section 103 of the Bengal Municipal Act applied to the lease agreement in question, as a lease is a species of conveyance and the domain of conveyance is included in the domain of contract. The court also held that the agreement was not binding on the municipality due to non-compliance with the mandatory provisions of Section 103(2) of the Act, which requires that every contract exceeding Rs. 500 shall be in writing, signed by at least two of the Commissioners, one of whom shall be the Chairman or Vice-Chairman, and shall be sealed with the common seal of the Commissioners. 3. The court held that Section 53A of the Transfer of Property Act and equitable estoppel were not applicable in the present case, as there was no instrument of transfer. The court found that the impugned agreement was not an instrument of transfer, as it did not comply with the mandatory provisions of Section 103 of the Bengal Municipal Act. 4. The court held that the appointment of a receiver was just and convenient, as it would prevent multiplicity of suits and proceedings and would ensure that the surplus money from the hat would be available to the defendant in the event of his success in the suit.
Final Decision: The court dismissed the defendant's rule, holding that the munsiff had pecuniary jurisdiction to try the suit, that Section 103 of the Bengal Municipal Act applied to the lease agreement in question and that the agreement was not binding on the municipality, that Section 53A of the Transfer of Property Act and equitable estoppel were not applicable in the present case, and that the appointment of a receiver was just and convenient.
( 1 ) THIS is a rule I had issued on August 24, 1966, under Section 115 of the Procedure Code, 5 of 1908, at the instance of the first defendant, Jitendra Nath Mukherji, calling upon the plaintiff opposite party, the Commissioners of Baduria Municipality, (simply "the municipality" hereafter, for short), to show cause why an appellate order dated August 20, 1966, which confirmed the order dated July 25, 1966, of the trial court, appointing a receiver in a pending suit, should not be set aside.
( 2 ) THE suit by the municipality is a suit for, amongst others, for three declarations. One, the agreement executed by and between the petitioner Jitendra, on one hand, and the then chairman of the municipality, Nandalal Sarkhel by name, on the other,--defendants both--,on April 22, 1965, and put to registration on April 24, 1965, touching a hat of the municipality, is collusive, illegal, void etc. Two, on the foot of such an agreement, the petitioner Jitendra, the first defendant in the suit, has acquired no title to the hat in controversy. Three, the agreement aforesaid is not binding on the municipality.
( 3 ) SHOULD the municipality get the first declaration, that the impugned agreement is void, the two other declarations follow as a matter of course. Leaving aside such prolixity, the other important reliefs, the municipality prays the court for, may be noticed. 'confirm our possession of the disputed hat by collecting the tolls, as we are doing'-- is one such relief 'restrain Jitendra by a permanent injunction from interfering with our possession'--is another relief.
( 4 ) THE facts on which such reliefs are grounded need not be referred to further than as follows:a. The hat in controversy yields an annual income of not less than Rs. 15,000. And the tolls of such a hat were farmed out to Jitendra for a 3-year term: 1372 to 1374 B. S. , on a paltry consideration of Rs. 3,200 a year. [the year which runs now is 1373 B. S. ] b. The impugned agreement is over the signature of Sarkhel only, the then chairman, on behalf of the municipality, and that too without the common seal, infracting thereby the mandatory provisions of Section 103, Subsection (2), of the Bengal Municipal Act, 15 of 1932, by virtue of which the minimum requirement, amongst others, is twofold. One, every contract, involving a value which exceeds Rs. 500, shall be signed by at least two of the commissioners, one of whom shall be the chairman or vice-chairman. Two, it shall be sealed with the common seal of the municipality. C. On April 14, 1966, the municipality, in its meeting, passed a resolution striking down the impugned agreement as void. On and from the day following, the municipality fixed the rate of tolls for the hat in controversy and started collecting the same, after Jitendra was apprised of the resolution dated April 14, 1966. D. On June 10, 1966, at 7 p. m. or thereabouts, when the municipality's men were realizing the tolls, an ex parte and illegal order under Section 144 of the Code of Criminal Procedure, 5 of 1898, was served on them.
( 5 ) HENCE the suit by the municipality on June 18, 1966.
( 6 ) THAT very day. die municipality applied under Order 40, Rule 1, of the Procedure Code for appointment of a receiver, reiterating the gist of some of the material averments in the plaint.
( 7 ) ON July 5, 1966, Jitendra, the first defendant and now the petitioner before me, resisted such a prayer by a verified petition, emphasizing amongst other things the legality and validity of the impugned agreement in the wake of a unanimous resolution passed by the municipality in its meeting of April 17, 1965, and the futility of its resolution of April 14, 1966, by which the agreement was in a man ner rescinded.
( 8 ) NO written statement has yet been filed.
( 9 ) THE learned munsiff, 3rd court, Basirhat, by his order No. 9 dated July 25, 1966, allowed the municipality's application for appointment of a receiver and appointed Mr. Nityag
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