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1925 Supreme(Mad) 575

IN THE HIGH COURT OF MARAS
Jackson
O.S. Rarnachandra Aiyar,
Versus
Sankara Aiyar
Decided On : 2 October, 1925

The interim Receiver cannot arrogate to himself powers to be conferred under Order 40, Rule 1(d) merely by possession. The property does not vest in the interim Receiver with all the incidents of Section 28 under Section 56 of the Provincial Insolvency Act. The interim Receiver shall only have such of the powers conferrable on a Receiver appointed under the Code of Civil Procedure as the Court may direct.

Headnote:

Receiver - Insolvency - Provincial Insolvency Act, Section 20, Order 21 Rule 89 CPC - Section 20 of the Provincial Insolvency Act attracts the provisions of Order 40 of the Code of Civil Procedure. The Court may appoint a Receiver, commit the possession, custody or management of such property to the Receiver, and confer upon the Receiver certain powers including the protection of the property. The Receiver cannot arrogate to himself powers to be conferred under Order 40, Rule 1(d) merely by possession. The property does not vest in the interim Receiver with all the incidents of Section 28 under Section 56 of the Provincial Insolvency Act. The interim Receiver shall only have such of the powers conferrable on a Receiver appointed under the Code of Civil Procedure as the Court may direct.

Fact of the Case:

One V. Mahadeva Aiyar was judgment-debtor in O.S. No. 407 of 1923. On 7th April, 1924, a creditor applied to have him adjudicated insolvent. On 8th and 9th April property of his was sold in execution of the decree. On 24th April the Official Receiver was appointed interim Receiver under Section 20 of the Provincial Insolvency Act. On 9th June the interim Receiver deposited moneys under Order 21, Rule 89, Civil Procedure Code, to have the sale set aside and the District Munsif of Mannargudi set it aside. The District Judge reversed the order of the District Munsif.

Finding of the Court:

The Court found that the interim Receiver cannot arrogate to himself powers to be conferred under Order 40, Rule 1(d) merely by possession. The property does not vest in the interim Receiver with all the incidents of Section 28 under Section 56 of the Provincial Insolvency Act. The interim Receiver shall only have such of the powers conferrable on a Receiver appointed under the Code of Civil Procedure as the Court may direct.

Issues: The main issue was whether the interim Receiver by virtue of his appointment under Section 20 of the Provincial Insolvency Act had power to act under Order 21, Rule 89, Civil Procedure Code.

Ratio Decidendi: The interim Receiver cannot arrogate to himself powers to be conferred under Order 40, Rule 1(d) merely by possession. The property does not vest in the interim Receiver with all the incidents of Section 28 under Section 56 of the Provincial Insolvency Act. The interim Receiver shall only have such of the powers conferrable on a Receiver appointed under the Code of Civil Procedure as the Court may direct.

Final Decision: The petition is dismissed with costs of the 1st respondent.

JUDGMENT

Jackson, J.

1. The petition is to revise the order of the District Judge, West Tanjore, in C.M.A. No. 29 of 1924.

2. One V. Mahadeva Aiyar was judgment-debtor in O.S. No. 407 of 1923 on the file of the Court of the District Mun sif of Mannargudi. On 7th April, 1924, a creditor applied to have him adjudicated insolvent. On 8th and 9th April property of his was sold in execution of the decree. On 24th April the Official Receiver was appointed interim Receiver under Section 20 of the Provincial Insolvency Act. On 9th June the interim Receiver deposited moneys under Order 21, Rule 89, Civil Procedure Code, to have the sale set aside and the District Munsif of Mannargudi set it aside. The District Judge reversed the order of the District Munsif. Hence the petition.

3. The point for determination as correctly stated by the learned Judge in his second paragraph is whether the interim Receiver by virtue of his appointment under Section 20 of the Provincial Insolvency Act had power to act under Order 21, Rule 89, Civil Procedure Code. He was appointed after the sale and therefore cannot be said by his appointment to have been vested in an interest by virtue of a title acquired before such sale. He can only come in under Order 21, Rule 89, Civil Procedure Code, if he is held to be " owning such property, " if, that is to say, by virtue of his appointment under Section 20 of the Provincial Insolvency Act, he stands in the place of the owner.

4. Section 20 of the Provincial Insolvency Act attracts the provisions of Order 40 of the Code of Civil Procedure. Rule 1 of which provides (a) that the Court may appoint a Receiver; (c) commit the possession, custody or management of such property to the Receiver; (d) confer upon the Receiver certain powers including the protection of the property.

5. In the present case the Court appointed the Official Receiver, Receiver of the properties with no other provision except that he should take steps to see that the properties were not sold for Government kist. It is difficult to see how this order could possibly make the Receiver a quasi-owner of the property. It is argued that some one had to protect the property and since it had been taken out of the owners hands, " the Receiver must be presumed to have been the proper person to act. Even assuming that the owner had been removed from the possession and had no right to protect the property and the Receiver considered it his duty to act, his proper ordinary course would be to apply to the Court for power to act, and, as a matter of fact, this is exactly what he did. He wrote on 28th May, 1924, requesting sanction to move the Munsif to set aside the sale. This letter was mislaid by the Judge till 26th June. Meanwhile the Receiver had informed the judge on 9th June that he was about to file his application under Order 21, Rule 89, Civil Procedure Code, in anticipation of sanction and on 10th June he filed such application with an affidavit asserting that he was entitled to present it as the interest of the judgment-debtor had vested in him. It does not appear from the record that any ex post facto sanction was ever accorded by the Judge. In these circumstances, it is impossible to hold that the Receivers action was authorised. The statute entirely provides for the contingency and he attempted to obtain sanction as contemplated by the statute; and there is no room for assuming that inherent power vested in the Receiver from the mere fact that he had been appointed as such.

6. Where the Indian statute is clear and sufficient nothing is to be gained by a reference to English case-law. Official Receiver of Coimbatore v. Kanga (1921) ILR 45 M 167 MLJ 53 is not directly in point, for there the Receiver whose powers are discussed is one appointed after adjudication Under Act III of 1907. Petitioner relies upon the phrase "the obtaining of leave is 9. matter between the Receiver and the Court." The Receiver had the power vested in him under Section 18 of that A





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